A Less Than Basic 6-7 Primer On AI For Residential Real Estate, LOL
AI Is Here. AI Is Over Hyped. AI Is Not Going Away.
I’m laying out some basics here and not recapping what AI is being used for in residential real estate. As someone who liked to live on the bleeding edge of technology, I always had to get the first iteration of something new, like the first iPhone on the day it was first launched. I always downloaded beta software updates, knowing it could be catastrophic, instead of waiting until the finished update was released. [Over the past decade] Since I became a grandfather, I’ve reduced my eagerness to dive in first and was admittedly late to the emoji game, preferring to use “LOL” instead of an emoji. At one point, I felt the FOMO and couldn’t wait any longer, which brings me to Artificial Intelligence (AI). Every so often, we experience leaps in technology that significantly impact our daily lives, and we can see the changes evolve right in front of us. When I think back to life before GPS, I can barely go to the local grocery store without being tempted to use Google Maps. When I was a kid, I went out on my bike, only knowing that I had to get home by dinner (without having a watch). My mom had no way to reach me for the entire day, and that was ok. At first glance, it’s easy to dismiss AI as overhyped (clearly, there is an element of that) or imagine the end of the world as Skynet becomes self-aware.
But if you think about AI in the context of indoor plumbing and electrical wiring in a home, then it begins to make sense. It’s less about AI Chatbotsand Generative AI. The benefit will be much more potent than that.
What Is AI?
NASA has a great explainer on their web site: (their text)
Any artificial system that performs tasks under varying and unpredictable circumstances without significant human oversight, or that can learn from experience and improve performance when exposed to data sets.
An artificial system developed in computer software, physical hardware, or other context that solves tasks requiring human-like perception, cognition, planning, learning, communication, or physical action.
An artificial system designed to think or act like a human, including cognitive architectures and neural networks.
A set of techniques, including machine learning that is designed to approximate a cognitive task.
An artificial system designed to act rationally, including an intelligent software agent or embodied robot that achieves goals using perception, planning, reasoning, learning, communicating, decision-making, and acting.
ChatGPT Is Not Synonymous with AI
ChatGPT burst onto the scene a few years ago and brought forth an AI revolution that was in the works for at least twenty years. The software is within the family of Large Language Models (LLM) that predict the next word of a sentence. It is not smart in the sense that we think about from movies like The Terminator (I paid homage to it in a prior post). It is a different way to search. We’ve been raised on searching Google for links. Search has evolved to “natural language,” and the more detailed your question, the more specific the answer. In fact, when I get very detailed about the residential real estate market, often the answer has a link to Housing Notes! Link-based searching will probably be nearly dead in less than a decade.
Wikipedia is panicking right now because they are seeing a noticeable drop in searches by humans, which means: “With fewer visits to Wikipedia, fewer volunteers may grow and enrich the content, and fewer individual donors may support this work.” It is the same problem we are seeing in the real estate appraisal world. The GSEs are going to eliminate appraisals for mortgage purposes, which means they won’t have appraisals to pull data from. The quality of Automated Valuation Models (Think Zestimate) could gradually erode from its already poor performance. My friend Phil Crawford calls that data cancer.
There is a point at which AI companies will have scanned all of human knowledge. What then?
AI Is The Napster Of Knowledge
Remember Napster? At one point, many thought it was a good idea to steal intellectual property from artists (music). They got sued out of existence and had to change their model. The AI startups are spending billions crawling the web to feed their databases. How will owners of the information get compensated or keep motivated to share their information?
Overhype Rules The Day
There is a growing consensus among analysts and investors that the current boom in tech spending—particularly in AI infrastructure and high-profile data centers—is exceeding near-term return potential. Research from Deutsche Bank and others indicates that U.S. GDP growth is being sustained by tech capital expenditures rather than measurable productivity gains from active AI. This pattern sure looks like a bubble, with outsized investment concentrated among a few dominant firms—the “Magnificent 7”—driving much of the market and economic momentum. I wrote a piece a while back on how AI firms are planning to get their enormous power needs from nuclear power!
In fact, without the boom in AI data centers factored into the calculations, US GDP barely grew in the first half of 2025. That suggests that the Fed is right - there will be about two more rate cuts in 2025 despite the ongoing inflationary tariff policy.
What AI Tools Are Being Used Right Now?
Its all happening out there but the macro changes to our industry is what really interests me.
Predictive analytics for lead generation
Automated property valuation
Personalized home searches
Marketing automation
Virtual tours
Client engagement
Final Thoughts
The point of this writing is to highlight the faster way to gather information, but not to fully embrace all the hype. AI isn’t intelligent in its purest form, but by combining millions of sources, we can get a smart answer (that isn’t always accurate). Reducing human overlap in the long run is a weakness of this approach. Reducing our ability to think and solve problems is another weakness.
For years, one of my older relatives thought “LOL” meant “lots of love“ (wait for it).
The Actual Final Thought – Gotta love me some detention.
StreetMatrix Arrives In California
Here’s the latest newsletter with links to all our resources. More specifics on this effort to come.
[Podcast] What It Means With Jonathan Miller
The Be Wary Of The Screams For RTO episode is just a click away. The podcast feeds can be found here:
Apple (Douglas Elliman feed) Soundcloud Youtube