Hey, chatbot: Who are you?

When AI starts looking an awful lot like a real estate agent

By Summer Goralik

Here I am, enjoying my morning brew, with little Ruby (my loyal pooch) at my feet, and suddenly the stillness of my day is broken by your chatbot.

What’s the problem? Well, for one, it won’t stop talking to me.

This bot, which has me cornered right where it wants me, is asking me all sorts of questions. It wants to know what I need, whether I am looking to buy (or sell), what’s important to me. It’s asking me about location, property type, price range and all of the things that matter to prospective buyers and sellers.

It’s fishing for information like we’re old friends.

In fact, if I close my eyes, take my fingers off the keyboard for a second and imagine this bot sitting next to me, I would be certain this was my agent, looking to provide me with some kind of real estate service.

Before I get any further here and, frankly, ruin someone’s day with regulatory concerns (yes, that’s where I am headed), I will strike a lighter note, at least for a moment.

The 2004 sci-fi film I, Robot is a very watchable movie. I could hang on every minute of it, completely entertained, or fall asleep to it as it quietly plays in the background, like the soothing sound of golf or tennis.

There’s a memorable scene in the film that keeps coming to mind. Detective Spooner, played by Will Smith, is talking to Sonny, an advanced robot, about a dream Sonny had. After describing the dream, Sonny asks whether it’s normal.

Spooner replies that he supposes anything is normal for someone in Sonny’s position.

Immediately, Sonny catches the word and says: “Thank you. You said ‘someone,’ not ‘something.’”

As I converse with your chatbot on this ordinary Wednesday morning, I can’t help but imagine Sonny on the other end.

Sure, I know I’m talking to a something. But the more it talks to me, asks about my needs, learns what I’m looking for and offers to help me navigate real estate, the more it starts behaving like a someone.

More specifically, like an agent. And that’s where things start to get interesting.

I swear, if I weren’t a compliance consultant, with an old government badge locked away in a drawer somewhere (I’m joking—they confiscated that), I might actually be impressed.

Although perhaps I am impressed—just for very different reasons. I’ll explain.

I am a former DRE investigator. I am a compliance consultant. I am an expert witness. And for those reasons, and those reasons alone, I am struck by this chatbot in the way someone might be taken aback by another person’s bravado. The boldness. Maybe even the audacity of it all.

Put another way, I can’t unsee what I have seen.

I have investigated and witnessed countless cases of “unlicensed activity” in my career. Hence, my compliance gut is not particularly happy with the broker- or agent-hosted site where this chatbot lives, breathes and seamlessly writes:

“How can I help you today?”

Ready to take on my world of inquiries and concerns, whatever those may be, and provide service like, well … an agent.

“Oh Summer, loosen up! It’s just a computer!”

No, sorry, I can’t. If your chatbot is doing things it shouldn’t, I have a problem. Hell, if it had arms and legs, it would be picking me up in a car right now and showing me property.

Might as well. It seemingly knows how to do everything else.

Old enforcement problem meets new AI world

Listen, I will reason with you.

I don’t want to shut down your site, ruin your AI party or interfere with your business goals and exploits. I get it. We are living in the future here. Brokerages are trying to become more efficient, automate operational tasks and use technology to interact with consumers.

But here’s my beef:

The enforcement camp that I grew up in says that if this chatbot were an unlicensed person employed or retained by the brokerage, and that person started doing some of the things these bots are doing, we might have a good old-fashioned case of unlicensed activity on our hands.

And this isn’t theoretical. I have investigated unlicensed people who crossed the line by asking a question they should never have asked. I have seen brokers disciplined for allowing unlicensed people to perform licensed acts. These are real cases, with real consequences.

Honestly, the bar isn’t necessarily as high as you might think. Or better said, it doesn’t always take that much.

DRE has long maintained Guidelines for Unlicensed Assistants addressing what unlicensed people may—and may not—do in a real estate operation.

I could sit here and give you example after example of how an unlicensed assistant might cross the line into licensed activity.

But I’m not going to. That’s not really the point of this article. The point is that the line exists. And now AI is walking right up to it, teasing the boundary, while I sit here in the peanut gallery waiting for the regulators’ next move.

Well, hello, chatbot

In March, the California Department of Real Estate issued an advisory addressing artificial intelligence in California real estate.

And here’s where things get intriguing. DRE expressly identified “Lead Generation and Customer Interaction” as a potential application of AI, including:

“Using AI-powered chatbots and automated lead scoring to help manage inquiries and prioritize follow-up.”

Okay. So, yeah, DRE knows chatbots are here. And it certainly hasn’t said that merely having a chatbot interacting with consumers constitutes unlicensed activity.

But DRE also said the following, which should get every California broker’s attention—and perhaps the attention of regulators and licensees elsewhere:

“Using AI tools to conduct licensed activity may be equivalent to asking an unlicensed assistant to do licensed activity, which is a violation of California real estate law.”

The question, then, isn’t whether you can have a chatbot. The question is: What is your chatbot doing?

Or, if you are me, knowing what I know, you might ask:

How far are you going to take this chatbot experiment?

I’ll give you exactly one example.

Suppose I’m a prospective buyer visiting a brokerage website.

Buyer: This property has been sitting for 74 days and already had two price reductions. What do you think I should offer?

Chatbot: Based on the listing history and comparable properties, I’d recommend offering $75,000 below asking.

Hmmm. I don’t know about that response. I know I’m not comfortable with it. Again, I have a lot of enforcement baggage to carry here. And all I can think is, When did the chatbot become the agent?

But I will tell you this: if an unlicensed human working for the brokerage couldn’t have that conversation with me, I think we should at least be asking why an AI assistant can.

So, who exactly are you?

Perhaps the chatbot living on the brokerage website is merely an extension of the broker’s license—technology operating under the broker’s authority, supervision and control.

That’s one school of thought.

Except I have never been aboard that train. My thinking is that if the chatbot is viewed through the traditional unlicensed-assistant framework, then we have a very different conversation on our hands.

If regulators ultimately decide that the age of AI calls for moving that line, so be it. I’ll get aboard that train when it leaves the station. But knowing what I know today, I’m not willing to manufacture licensing flexibility that regulators themselves haven’t clearly given us.

DRE told us this year that AI-powered chatbots can be used to help manage inquiries. It has also told us that using AI to conduct licensed activity may be equivalent to asking an unlicensed assistant to do it.

And somewhere between those two statements and those two possibilities sits your chatbot. Talking to me. Answering questions. Gathering information. Maybe advising me.

Suddenly, Sonny isn’t looking so much like a something. He’s starting to look like a someone.

And that someone is starting to look an awful lot like an agent.

I asked regulators this question

Earlier this year, when I presented my keynote at ARELLO’s Mid-Year Meeting, I told regulators from across the country that they were going to have to figure this out.

Chatbots are doing the work of agents right now, on websites. They are engaging consumers. They are answering questions. And depending upon how they are designed and deployed, they may be doing considerably more.

How do regulators view that activity? Does it run afoul of existing licensing law—or operate within it?

California has now given us at least part of the answer: AI doesn’t get a free pass simply because it’s AI.

But I don’t think the conversation ends with one advisory. In fact, our present climate begs for more guidance—something more definitive on where that line actually sits.

My chatbot problem

So this compliance consultant, calmly sipping her coffee while adored by her canine, would be lying if she didn’t tell you about the spike in her blood pressure as she corresponds with your chatbot.

I know what I know.

And brokers are, of course, eager to play with new tools—what I recently compared to having a Ferrari in the driveway—and offload operational tasks to AI and move to the beat of the future.

Again, I can appreciate that.

But existing licensing law didn’t disappear when the chatbot arrived. It’s still playing in the background like a tune I can’t get out of my head.

Neither did broker supervision. If a brokerage deploys an AI tool to interact with consumers, is the broker—or a properly designated licensee—overseeing what that tool is doing and saying?

No worries, I’ll answer that one: They should be.

So, whoever needs to hear this, I don’t actually want your chatbot to disappear. Yes, it might be able to answer some questions, help in some ways and make your operation more efficient.

Just don’t let it become the agent.

And as I sit here staring at the chatbot still waiting patiently on my screen, somewhere in my head, The Who starts playing a classic:

Who are you?

Funny. That’s exactly what I’d like to know.

About Summer

Summer Goralik is a Real Estate Compliance Consultant and licensed Real Estate Broker (#02022805). Summer offers real estate brokers a variety of consulting services including assistance with California Department of Real Estate investigations and audit preparation, mock audits, brokerage compliance guidance, advertising review, and training. She helps licensees evaluate their regulatory compliance and correct any non-compliant activities. Summer has an extensive background in real estate which includes private sector, regulatory and law enforcement experience. Prior to opening her consulting business in 2016, she worked for the Orange County District Attorney's Office as a Civilian Economic Crimes Investigator in their Real Estate Fraud Unit. Before that, Summer was employed as a Special Investigator for the DRE for six years. Among many achievements, she wrote several articles for the DRE, which still live on the Department's website today. Prior to her career in government and law enforcement, Summer also worked in the escrow industry for nearly five years. For more information about Summer's background and services, please visit her website.