Are you using A.I. to value your home? Here’s why you might want to think twice

Brett Liscomb form the Bennett Property Shop tells us why potential sellers should be wary of using A.I. tools to estimate the value their home.

While it might seem tempting to use A.I. to value your home, an Ottawa real estate agent says these tools might be doing sellers more harm than good.

Brett Liscomb, realtor with the Bennett Property Shop, joined CTV Your Morning Ottawa on Thursday to speak about the risks of using A.I. to price a home.

“When you’re talking about your biggest asset, you want to be in a situation where you’re being precise and that can only come from people in your house,” Liscomb said.

Liscomb says one of the issues with A.I. home valuation is they don’t consider every factor in their estimates.

As Liscomb explains, A.I. tools typically rely on recent sales data to provide an estimate, but they will generally fail to consider important factors, like the micro-market of the home, updates made to the property and larger supply and demand trends.

“Look at some things that are outside of our control, like the return to work,” he said.

“If you looked at those places, like Rockland, Richmond, Carleton Place that had huge demand prior to the pandemic, now that [workers] go back, those markets are being impacted by buyer demand, so the A.I. doesn’t take that into consideration.”

Accurate pricing can make all the difference in a slow market and Liscomb says nearly 60 per cent of homes “aren’t selling their first try.”

“When you have inventory that’s basically at a nine year high across the city, you’re in a place where pricing very many matters,” he said.

Sellers who list their house based on inflated A.I. estimates may end up scaring off potential buyers, Liscomb says.

“When you do overprice your home, what happens is people go ahead and put it on the back burner, they put it in the kind of discard pile because they don’t see the value of it,” he said.

“It gives people a reason to devalue it.”

Real estate professionals, Liscomb says, can provide the “fine touch” needed to properly price a home.

“Maybe it’s the small touches you’ve made with crown moulding, or it’s the touch-up in the painting or the landscaping, or how nice your neighbours are — all these things have to be taken into consideration,” Liscomb said.

“But the most important thing is how it fits into the market at any given time, depending on what’s recently sold or what’s on the market. These are things that A.I. just can’t replicate.”

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