Artificial intelligence is shaking up how agents and brokers do business. But there are some legal pitfalls to watch out for.

Artificial intelligence is enabling real estate professionals to streamline some of their work by generating instant responses to customers or even predicting the next client. But using the technology in your business comes with the potential for liability, warns Chloe Hecht, senior counsel for the National Association of REALTORS®.

In the latest “Window to the Law” video, Hecht details the risks for real estate pros, whether using AI for chat bots, personalized advertising or automated messaging. AI tools are being used to craft social media posts, draft property descriptions and improve lead generation, among other tasks. The public awareness of AI technology has increased due to the recent launch of platforms like ChatGPT and Stable Diffusion.

Hecht offers these tips when using AI tools in your business:

  1. Watch for accuracy. “AI platforms are not 100% accurate, which makes your oversight critical,” warns Hecht. When using AI, especially to write listing content like property descriptions, you must ensure the information is correct. Hecht reminds NAR members that they are bound to the REALTOR® Code of Ethics, which prohibits exaggeration, concealing pertinent facts and misrepresentation in communication and representations to clients.
  2. Watch for copyright laws. “Under U.S. copyright law, a work must be authored by a human to qualify for protection, meaning AI-generated works are not protectable,” Hecht says. However, laws governing AI are likely to evolve over time.
  3. Watch how you use it. Avoid using AI to draft contracts, modify standard forms or provide legal advice to clients, Hecht says. She adds that many state laws, as well as Article 13 of the Code, prohibit the unauthorized practice of law. “AI is not a licensed professional, and the platforms make no reliable warranties or representations,” Hecht says.

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