AI tools offer a quick estimate, but they can’t factor in your home’s unique features.
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If you’re thinking about selling your home this year, you’ve probably checked its value using tools like Zillow or Redfin. These apps promise quick estimates based on data and algorithms, and they’re getting better every year. But here’s the big question: can you really trust AI to price your most valuable asset accurately?
Before you list your home with an AI price estimate, you need to hear this:
I recently worked with a client just outside of town who was ready to sell their four-bedroom home in a competitive market and decided to use an AI tool for a pricing estimate. AI pulled data from recent sales nearby, adjusted for square footage, and looked at market trends. It estimated their home’s value at $1,620,000.
However, it missed some key features: a $100,000 kitchen renovation with high-end appliances, smart home technology, and a prime location on a quiet cul-de-sac with greenbelt views. None of these factors was reflected in the AI estimate.
“AI can crunch data in seconds, but it can’t walk through your house.”
After I walked through the property and analyzed local buyer demand, we listed the home at $1,750,000 and received multiple offers within days. That’s a $130,000 difference between the AI estimate and the actual market value.
So, let’s break down what these tools do well, where they fall short, and how to ensure your pricing strategy helps you avoid losing out on thousands.
What AI does well in home valuation. AI tools have come a long way by 2025. They pull in tons of data from public records, MLS sales, and even tax info to give you a quick estimate of your home’s value.
If you’re in a neighborhood with cookie-cutter houses, like a suburban subdivision where every home’s got a similar vibe, these tools can be pretty spot-on. They’re fantastic for getting a ballpark figure without picking up the phone to call an agent. Plus, they’re always learning, tweaking their numbers based on factors such as interest rates and market trends. It’s fast, it’s easy, and it’s a solid starting point.
Where AI misses the mark. Despite their strengths, AI tools have limitations. They can’t physically tour your home to assess unique upgrades, like a $40,000 basement turned home theater or breathtaking views.
It also struggles in markets with diverse or limited sales data, like older neighborhoods, custom builds, or rural spots. In fast-changing markets, AI often lags, relying on past sales rather than current buyer behavior. A 2025 survey of real estate pros found that 87% think AI undervalues homes with unique features or upgrades, which could mean fewer buyers or lowball offers for you.
Where new AI tools are crushing it. One of the AI tools we use is called Renovision. With just 10 interior and 10 exterior photos, it reads 532 data points from your home. It identifies the fixtures, finishes, and upgrades, then compares them to the top recent sales in your area using MLS data. From there, it provides an estimated value that’s typically within 2% of today’s market.
Renovision can also create a virtual remodel of your home. It shows what your home could look like after a renovation, calculates the cost, and even estimates your return on investment, whether you’re thinking about redoing your kitchen or updating your primary bathroom. It is simply a game-changer.
Should you rely on AI alone? I can give you a starting point for your home’s value, but if you want an accurate estimate or to understand its maximum potential, you’ll need more than just a number. That’s where strategy comes in. As experts, we combine AI, data-driven insights, renovation experience, and local market knowledge to give you a complete picture. AI helps us assess your home’s unique features, evaluate its potential, and create a plan tailored to your goals. Whether you want to sell quickly or make updates to maximize your return, we’ll guide you toward the best outcome.
Simply put, just use both AI and ask for help from a local expert. Having a local real estate agent help you with your pricing will be one of your best decisions if you want to get more for your home.
If you’re planning to sell this year, don’t let a computer decide your asking price. For expert guidance, you can call me at 408-596-4490 or send an email to Brett@TheRealExperts.com. Talk to you soon!
