Are AI real estate agents the future for homebuyers? These firms think so
Users
log
on
to
the
platform
via
website
or
mobile
application
and
can
be
guided
through
the
homebuying
process
by
reAlpha’s
AI
technology.
Consumers
who
utilize
the
platform
must
sign
a
buyer
representation
agreement
with
reAlpha
Realty,
but
they
are
allowed
to
break
it
at
anytime
and
will
not
incur
a
penalty.
“In
order
for
us
to
represent
the
buyer,
we
have
to
be
a
licensed
agent,
so
that
is
why
we
have
reAlpha
Realty
and
we
have
human
licensed
agents
that
work
behind
the
scenes,“
Logozzo
said,
“which
is
important
because
we
can’t
just
flip
a
switch
and
have
everything
fully
AI.
There
is
a
learning
curve,
and
if
somebody
wants
to
speak
to
an
actual
human,
someone
is
there
for
them.”
Looking
ahead,
reAlpha
executives
believe
AI
and
automation
are
the
way
of
the
future
for
the
real
estate
business,
as
the
world
has
witnessed
in
other
industries.
“In
the
stock
brokerage
industry
in
the
late
’90s
and
early
2000s,
they
used
to
charge
1.5%
per
trade.
And
then
Charles
Schwab
came
in
and
said,
’$49
a
trade.’
And
then
soon,
several
other
players
came
in
and
we
have
Robinhood
with
a
0%
commission,”
said
Giri
Devanur,
the
founder
and
CEO
of
reAlpha.
“The
same
thing
happened
to
the
travel
agent
industry.
In
the
real
estate
industry,
the
question
is,
’How
soon
is
it
going
to
happen?’”
Modern
Realty
Modern
Realty
shares
similarities
with
reAlpha
in
that
it
is
currently
operational
in
only
one
state
—
California
—
and
those
who
work
with
the
firm
must
sign
a
buyer
representation
agreement,
giving
them
access
to
both
an
AI
and
a
human
real
estate
professional.
But
unlike
reAlpha,
Modern
Realty
is
much
newer,
having
officially
launched
only
three
months
ago.
“The
legal
side
of
things
—
mixed
with
the
NAR
settlement,
mixed
in
with
what
we
are
actually
seeing
in
the
field
—
it
is
very
interesting.
And
there
are
a
lot
of
other
moving
parts,
like
the
introduction
of
AI,
so
it
is
a
very
exciting
time
to
be
in
this
space,”
said
Raffi
Isanians,
the
CEO
and
co-founder
of
Modern
Realty.
Isanians
and
his
team
want
to
use
AI
to
make
the
homebuying
process
faster
and
less
scary
for
consumers.
To
best
serve
buyers,
the
Modern
Realty
team
has
built
unique
Realtors
for
different
types
of
clients.
“If
somebody
mostly
cares
about
data,
it
will
feed
them
as
much
data
as
humanly
possible,
and
if
the
homebuyer
cares
more
about
the
emotional
elements
of
the
transaction,
the
AI
will
respond
with
a
bit
more
emotion,”
Isanians
said.
“And
all
of
this
is
with
the
intention
of
making
the
homebuying
process
better
and
more
enjoyable
for
the
people
involved.“
Part
of
how
Modern
Realty
does
this
is
by
training
its
AI
to
mimic
the
top
1%
of
real
estate
agents.
“When
you
buy
a
house,
you
don’t
always
get
a
top
agent,
but
with
Modern
Realty,
you
do,”
Isanians
said.
Consumers
wanting
to
use
Modern
Realty
must
first
go
through
an
onboarding
process
with
a
human
staff
member,
who
talks
them
through
the
process
and
the
options
they
have.
They
are
then
given
a
phone
number
to
text
and
communicate
with
their
AI
agent
at
any
time.
Most
consumers
who
use
Modern
Realty
will
still
have
to
pay
a
commission,
as
they
would
with
a
human
agent,
but
it
is
possible
to
greatly
reduce
the
amount
or
even
eliminate
it.
The
company
has
two
service
tiers.
For
1%
of
the
home’s
purchase
price,
buyers
can
use
what
Isanians
describes
as
a
“self-service
model“
that
is
mainly
geared
toward
investors.
Other
buyers
who
want
or
need
higher-touch
service
have
a
negotiable
commission,
but
the
company
also
offers
a
grant
program
where
people
can
apply
and
have
the
commission
waived
entirely.
“We
believe
that
buying
a
house
is
very
hard
and
it
is
not
getting
easier,”
Isanians
said.
“So,
we
are
genuinely
on
this
mission
to
make
it
better,
so
very
early
on
we
had
a
conversation
that
if
people
meet
certain
criteria,
we
will
waive
the
entire
commission.”
Looking
ahead,
Isanians
said
that
Modern
Realty
hopes
to
expand
nationwide
and
will
eventually
consider
taking
on
sellers
as
well
as
buyers.
“It
is
scary,
if
I
am
being
completely
honest,”
Isanians
said
of
the
rapidly
changing
real
estate
landscape.
“Everyone
is
following
the
puck,
but
nobody
knows
where
it
is
going
to
go.
“We
have
focused
most
of
our
efforts
on
what
we
know
is
going
to
stay
the
same
—
and
that
is
that
buyers
are
going
to
want
an
incredible
experience,
and
we
believe
they
deserve
to
have
that.
So,
really,
what
then
is
changing
is
the
advancement
of
large
language
models,
which
we
are
leveraging
to
provide
consumers
with
the
experience
they
want.”
Homa
Unlike
Modern
Realty
and
reAlpha,
Homa
does
not
represent
buyers
in
transactions,
and
as
such
does
not
require
users
to
sign
a
buyer
agency
agreement.
“Homa
is
really
meant
to
help
those
homebuyers
looking
to
represent
themselves
and
are
trying
to
find
a
way
to
work
through
the
process,”
said
Arman
Javaherian,
a
former
director
of
product
at
Zillow
and
the
co-founder
of
Homa.
Homa
is
a
tool
that
allows
unrepresented
homebuyers
—
or
even
represented
buyers
—
to
have
all
their
urgent
questions
about
the
homebuying
process
answered.
It
is
available
to
consumers
across
the
country.
The
platform
guides
consumers
through
the
entire
homebuying
process,
from
getting
preapproved
for
a
mortgage
to
making
an
offer
and
eventually
closing
the
transaction.
Functionalities
include
putting
together
comparative
market
analyses
on
properties
the
buyer
is
interested
in,
allowing
them
to
price
their
offer
appropriately.
Homa
even
helps
them
fill
out
the
appropriate
forms
for
their
state
and
coaches
them
through
any
negotiations
that
may
occur.
Additionally,
in
Florida,
Homa
has
a
partnership
with
home
showing
platform
Showami
that
allows
buyers
to
tour
a
property
with
an
agent
for
a
one-time
fee,
which
is
typically
about
$50.
Javaherian
said
he
hopes
to
expand
this
partnership
nationwide
to
better
serve
all
Homa
users.
Having
just
launched
earlier
this
month,
Homa
is
currently
free
to
all
users
as
Javaherian
said
he
and
his
team
are
currently
bootstrapping
the
project.
Moving
forward,
he
said
the
firm
is
thinking
of
charging
users
a
one-time
fee
of
roughly
$100.
“The
main
reason
we
started
this
is
that
we
want
to
keep
costs
low,
and
charging
thousands
of
dollars
for
access
is
not
doing
that,”
Javaherian
said.
“I
want
this
to
help
homebuyers.”
The
most
recent
NAR
Profile
of
Homebuyers
and
Sellers
published
in
2023
found
that
89%
of
buyers
used
a
real
estate
agent.
But
Javaherian
said
he
is
confident
that
share
will
go
down
in
light
of
the
business
practice
changes
and
conditions
outlined
by
NAR’s
settlement.
“I
don’t
have
a
quantitative
analysis,
but
based
on
conversations
and
statistics
I
do
have,
I
feel
good
about
this,”
Javaherian
said.
“In
a
typical
year,
roughly
70%
of
homebuyers
are
repeat
homebuyers,
so
they
have
gone
through
the
process
and
have
confidence
in
it.
“Of
that
70%,
the
ones
that
are
more
tech-friendly,
like
the
millennials,
are
going
to
be
very
open
to
using
something
like
this.
A
lot
of
people
think
they
can
transact
real
estate
by
themselves,
and
I
think
that
is
going
to
drive
them
to
find
a
way
to
figure
it
out.”