Will someone buy a house from an AI real estate agent?

Let’s unpack that together, shall we? Some of this conversation got stirred up thanks to an article from Real Estate News profiling a company called Homa. Homa basically offers a suite of AI tools to help buyers purchase a home represented by an AI real estate agent, not a human one. As Arman Javaherian, the company’s co-founder, puts it: “Homa does not represent buyers in transactions, but aims to be a cheaper, DIY option that supplies all the tools they need.”

Is this like the FSBOS?

Ok, so this is sorta like for-sale-by-owner tools, but for buyers in today’s marketplace. Which is really the market share, I think they’ll attract. 

Last year, FSBOs were at some of the lowest levels, even though there was a quite hot real estate market. (It was 6% of all transactions last year.) 

My personal opinion is that it is the top-end market share for something like this. 

I also think they’ll have to keep this “unrepresented” approach since you can’t get an AI bot licensed (yet), and I just don’t see buyers in mass doing this. 

Just imagine buyers trying to do it “on their own” with just an AI bot to advise them. Yikes. 

Granted, I could be over-indexing for the human in the machine, but I just feel like when it comes to one of the biggest decisions a person makes, which they normally do every 10 years or so, I just don’t see them leaning on a machine. 

I mean, you should see my dad trying to send a text on his iPhone. You mean to tell me THAT guy is going to work with an AI bot to buy a house? Not likely. 

“But what about the kids, Crazy Uncle? They grew up with tech!”

Yeah, I hear you. They’re more comfortable with technology, sure. But they still have tribal brains. (I’ve talked about this before; you can read that post here.)

Even the most tech-savvy Gen Z buyer still has a caveman brain wired to talk to the village elder before making a big decision. The wiring that helped us get to the top of the food chain requires us to lean on each other to survive. We evolved to survive by relying on each other, not code. That wiring doesn’t just disappear.

Think about the last big decision you made. Maybe taking a new job. You researched. You Googled. You checked Glassdoor. You may have even asked ChatGPT. But you also talked to your best friend. Your business mentor. Your mom or dad.

Now I’m going to quote myself (yeah, I know, weird move):

“Homo sapiens emerged around 300,000 years ago. The first electric light was installed 142 years ago. The internet popped up 32 years ago. Y’all, we’re only two or three generations away from NO ELECTRICITY. That’s the brain we’ve still got. That’s the wiring we’re working with. If you draw the line at electricity, that means we spent 299,858 years in a non-electric, oral tradition.”

And now that brain is supposed to just… trust AI with the whole home-buying process?
Highly doubtful.

Let’s run through just a few of the problems with this “AI real estate agent” setup:

Showings:
I know their website says you can call the agent or work with them and their showing team. I haven’t tested it personally, but I can tell you that what it takes to get an offer accepted is multi-faceted. You’ve got to be out there looking at properties weekly and then also rapidly responding to properties that come on the market that are a perfect fit.

Since this is unprecedented, the buyer basically has to manage all that… good luck. And how is Homa even helping with the showing of the Buyer Broker Agreement rules that came down from the settlement? My guess is they aren’t worried about it at all since they’re not representing the buyer, but it’s going to be awkward every time they want into a showing. 

Offer writing:
I believe they’ve got a great AI real estate agent tool to help you figure out the offer price (Heck, I am even consulting with a company now to help them build something similar). That part is easy. But talking to a human being about what to offer is a nuanced and different approach. There is buyer’s remorse. There is the “I would have offered that much if I knew it would have won”. And on and on. Offer writing is part science for sure. And the AI can handle that. But it is also an art, and the AI will struggle with that part. 

Negotiation:
Sure, the AI real estate agent bot will help you negotiate. But the buyer is the one who is going to have to negotiate with the agent, who does this for a living. They do it every day, know what to look for, and look out for. The buyer does this every 10 years. Who is probably going to win that negotiation? 

Disclosures:
Is AI pulling all the required disclosures? That part’s easy. Explaining them? With enough training, sure. But truly understanding what you’re signing without an expert? That’s risky. And if something goes sideways? You did it unrepresented. Good luck emailing yourself a complaint or suing the AI company.

These are just a few challenges off the top of my head. I’m sure we could brainstorm dozens more.

To be very clear: I’m not here to bash Homa in any way. I actually think their tools are slick. I just think they’re pointing them at the wrong audience.

They should be selling this toolkit to agents, not going directly to consumers.

Because here’s my belief:

Agents aren’t going to be replaced by AI.

They’re going to be replaced by other agents… who use AI.

That being said, Homa does make a lot of sense for some buyers. Want to know who? Well… me, for example. I have bought and sold a lot of property over my 27 years in real estate. I have flipped over 100 homes over the years. I feel pretty comfortable “representing myself” in a transaction, at least locally in the markets I have been in for years. 

So if they built their model on getting 6% of the addressable market, and that works for them, awesome. Will they get a lot more than that? I just don’t think so. 

Because tech is amazing, but we’re still humans using it. And how our brains are wired?

Yeah, that still matters.

Keith Robinson is Co-CEO for NextHome, Inc.

This column does not necessarily reflect the opinion of HousingWire’s editorial department and its owners.

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