AI in Real Estate: 3 Pitfalls to Avoid

Chloe Hecht, senior counsel for the National Association of REALTORS®, warns of potential liabilities when incorporating AI in real estate. In the latest “Window to the Law” video, Hecht outlines risks associated with using AI for chat bots, personalized advertising, or automated messaging. AI tools are increasingly utilized for drafting property descriptions, enhancing lead generation, and crafting social media posts, .

Below are tips when using AI in Real Estate Business:

Be vigilant about accuracy.

Hecht emphasizes the importance of oversight due to the inherent imperfections of AI platforms. Specifically, when employing AI for tasks such as generating property descriptions, it’s essential to verify the accuracy of the information provided. Hecht emphasizes that NAR members must follow the REALTOR® Code of Ethics, which forbids exaggeration, hiding crucial information, and misrepresentation when communicating with clients. Therefore, maintaining vigilance over AI-generated content is crucial to ensure compliance with ethical standards and uphold professional integrity.

Exercise caution regarding copyright regulations.

Hecht notes that according to U.S. copyright law, protection is typically granted to works authored by humans. This implies that AI-generated creations currently do not qualify for legal safeguards. It’s crucial to recognize that regulations concerning AI are subject to change and may evolve over time. Stay informed and monitor developments in the legal landscape regarding AI-generated content to ensure compliance with emerging laws and regulations.

Exercise caution when using AI.

Hecht advises against employing AI for tasks such as drafting contracts, altering standard forms, or offering legal advice to clients. This caution stems from the fact that numerous state laws and Article 13 of the Code explicitly forbid the unauthorized practice of law. It’s essential to recognize that AI lacks professional licensure. Moreover, platforms providing these services typically do not offer reliable warranties or representations. Therefore, relying on AI for legal functions may pose risks and potentially lead to legal complications. It is advisable to seek guidance from licensed professionals when dealing with legal matters to ensure compliance with regulatory frameworks and ethical standards.

Ethics Implementation When Using AI

In conclusion, while the integration of AI in the real estate industry brings about numerous advantages, it is important for professionals to be careful and attentive. Chloe Hecht’s insights highlight the potential legal pitfalls and ethical considerations associated with AI use. Whether it’s verifying information accuracy, staying mindful of copyright laws, or refraining from relying on AI for legal functions, practitioners must navigate this transformative technology with a keen awareness of its limitations and evolving legal landscapes. By doing so, real estate professionals can harness the benefits of AI while ensuring ethical conduct and legal compliance, ultimately fostering trust and integrity within the industry.