The Rise of Robot Landlords: How AI is Automating Home Rentals and Real Estate Transactions in the US

  Jamie stands on the porch of a brick row house in Pittsburgh, cell phone in hand, and studies the house in front of him. The house was in an alley, facing the church, and the letterbox by the door was filled with rain-soaked junk mail.
  The camera of the rental company scanned Jamie’s face, and the algorithm determined that he was the same person as Jamie’s previously uploaded ID card profile picture. Jamie’s phone then received a six-digit temporary code. Jamie opened the door, but the room was empty.
  The suite has a living room painted pure white on the first floor, a fully equipped kitchen, two bedrooms upstairs that are not very furnished, and a small backyard with a third of the fence missing. The bathroom is in an odd location, in the unfinished basement, and Jamie feels like the flippers have converted the original bathroom upstairs into a second bedroom.
  This one-hundred-year-old house is about 80 square meters, not perfect but livable, and it is a good garage.
  As soon as Jamie left, he received a text message asking if Jamie would like to apply to rent the house for $1,530 a month. If Jamie agrees, like a house inspection, Jamie can go through all the renting steps—apply, pay a deposit, move in, and even live for a few years—without talking to a human. No one will give Jamie a key, only a combination.
  That’s right, Jamie met a robot landlord from Imagine Homes.
  Fully automatic renting
  In recent years, artificial intelligence has developed rapidly, and powerful AI has set foot in previously unimaginable fields. In the most complex game of chess, Go, Google Master overwhelmingly defeated Ke Jie, the strongest human player; Drive to the airport by yourself; in the stock market, the biggest opponents of retail investors are not bookmakers, but those automatic trading programs; and primary and middle school students are obsessed with using ChatGPT chat software to do their homework.
  Now, fully automated robot landlords are also appearing, and Imagine Homes is one of them. The company was founded in 2016, and its leasing business has spread all over Pittsburgh, Cleveland, Minneapolis and many other post-industrial cities with a large number of single houses. Currently, there are thousands of houses for rent on the official website. The company uses new data tools and technology to minimize on-site labor costs while collecting profits from rental properties.
  A few years ago, Airbnb, the world’s largest homestay company, had a plan to create a robot landlord. At that time, Airbnb and Facebook had bid for Ozlo, an artificial intelligence company. The system built by the company could understand people’s preferences for restaurants based on communication. won.
  At that time, Airbnb planned to use artificial intelligence to provide guests with rooms they might like to stay in and recommend guests to landlords. Now start-ups such as Imagine Homes have realized these functions.
  In addition to Imagine Homes, there are several similar companies in the United States that use robot landlords for fully automated house rentals and real estate transactions. For example, American Homes has nearly 60,000 houses in 22 states, and another company called Arrived Homes goes a step further. It not only provides tenants with a fully automated rental experience, but also sells shares of houses to real estate investors on its official website. , Pulling everyone into this speculative activity.
  A product of the smartphone era
  The emergence of such companies can be traced back to the 2008 financial crisis.
  After the U.S. real estate market collapsed, because many people could not repay their loans, a large number of houses were auctioned on the market, which made many companies and individuals see opportunities. Many companies bought a large number of small houses and rented them out, and the business expanded rapidly. The largest of these, Invitation Homes, has more than 80,000 homes in 16 metropolitan areas. American Home also owns more than 58,000 houses in 22 states, and even Amazon founder Jeff Bezos has bought multiple houses through Arrived Homes for profit.
  Because the number of homes owned is too high to hire a broker to manage rentals the traditional way, these companies are investing aggressively in AI technology, leading to startups like Imagine Homes, which has developed fully automated robot landlords. .
  In 2021, Kelly, in her twenties, had to move to the Pittsburgh metropolitan area due to a job transfer. She wanted to live in the city, but didn’t have many options. She found a three-bedroom house on the real estate website. This is a property of Imagine Homes. The community environment is average, but it is close to the highway and it is more convenient to go to work.
  After going through the same inspection process as Jamie, Kelly got the keys and the rent is $1,590 a month. Everything from adjusting the thermostat to paying rent can be done with her phone. She never had face-to-face interaction with anyone at the company. “Moving in was fairly simple,” she told The Washington Post. “All the information was left in a folder on the counter, all the files and passwords were provided electronically, without direct interaction with anyone. I Very happy to accept this way of renting, and Imagine Homes and I are both products of the mobile phone generation.”
  For essential home repairs, the robot landlord has also designed a completely contactless way. Tenants take pictures of the damaged parts of the house and send them to the company with their mobile phones. The company conducts 24/7 geographic tracking of the maintenance workers and dispatches the nearest workers to repair them. If tenants want to make repairs themselves, Invitation Homes, another robot landlord company, will push residents some repair instructions, such as replacing the toilet damper valve and replacing the garage door light.
  Of course, due to the variety of housing maintenance work in the United States, these automated methods cannot be fully covered. For example, water leakage in pipes and short circuits in wires require careful inspection, and the cost calculation is also complicated, which often cannot be resolved satisfactorily. Imagine Homes customers often have this problem There are complaints.
  Osborne, a tenant at Imagine Homes near Cleveland, complained to The Washington Post that there were often long waits for simple repairs, such as replacing door handles. In addition, he and the robot landlord also disagree on who is responsible for lawn maintenance. “I think they rely too much on electronic devices and remote services and ignore our needs.” He said.
  How to optimize maintenance services may be the next problem for robot landlords to solve.
  Robots grab houses
  If you want to get more profits, the landlord must buy the most popular house on the market as much as possible.
  So robo-landlords use algorithms to snap up homes on the market. It builds models to screen homes worth buying based on things like their distance from job centers, traffic conditions, neighborhood appeal, accessibility to nearby amenities, building type, and maintenance needs.
  Because the decisions made by AI are reliable enough that human inspection can be omitted, transactions are often completed in a short period of time.
  Often, just hours after a homeowner posts a home for sale, the robot landlord makes a cash offer ahead of all the human buyers. There are two advantages to dealing with a robot landlord. First, the offer it makes is more attractive, and the seller can also avoid the trouble of receiving buyers to visit the house. This allows the seller to sell his house to Robot landlord.
  Imagine Homes has been on a buying spree after establishing the concept of a robot landlord. In 2022, a limited liability company affiliated with the company purchased 35 homes in the Cleveland area and 27 in the Cincinnati area, according to local real estate directory searches, with the stated goal of never buying more than 20. million dollar house.
  In December 2022, Keller of Cincinnati posted his house—a one-story, three-bedroom house in a “working-class neighborhood all over the place”—on a listing website. He and his wife bought it for $117,000 in 2017, and he figured his buyers would be like them, a young couple.
  But within hours, he received a $10,000 cash offer from Imagine Homes — a favorite deal for American sellers, which equates to a full-money, no-mortgage offer. In addition, the company also agreed not to conduct a home inspection process-usually human buyers will entrust professionals to check all the details of the house, pick out the faults, and then bargain, usually at least $10,000 or more after the house inspection.
  In the end, Keller’s house was sold for $175,000. “This is an offer I can’t refuse, and I don’t want to refuse,” Keller said in an interview.
  Another representative of Invitation Homes, another robot landlord concept company, said vaguely in an interview with Vice that the company has recruited local experts in each market to launch a combined robot and human operation model, and hopes to replicate this approach globally. . The representative would not elaborate on how the company used its technology to grab homes.
  At present, the citizens of Cincinnati have become terrified of these robot buyers, thinking that they will snap up good houses, and the city council is considering a proposal to ban robot snatching houses.
  The emergence of companies such as Imagine Homes means that the already highly financialized US real estate market has entered a digital stage, and the speed of house leasing and buying and selling will be greatly accelerated. Consumers shrouded by algorithms will have fewer and fewer choices, and the efficiency of big capital using real estate to harvest the middle class will increase to an incredible level.