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During a presentation on artificial intelligence at the National Association of Realtors‘ midyear conference on Tuesday, two attendees in the audience whispered to each other.
“Scary.”
“So many bad things that we could do.”
The presenter, NAR’s director of emerging technology Dan Weisman, had just shown how elements in listing photos could be added or removed with a simple text query.
“This has grown faster than any technology we’ve seen and one we strongly believe isn’t just a fad but is going to continue to grow on itself,” Weisman said at a meeting of the trade group’s Risk Management Issues Committee meeting during its Realtors Legislative Meetings in Washington D.C.
After the presentation, Zach Vollmer of Victor Insurance, NAR’s endorsed errors and omissions (E&O) insurance carrier, declared, “From an insurance standpoint, AI terrifies me. The potential for misrepresentation claims is limitless.”
The comments heard at the meeting illustrate the disquiet surrounding the rapid advent of AI tools such as ChatGPT and DALL-E in the real estate industry.
But at the meeting, NAR’s senior counsel, Chloe Hecht, offered attendees best practices for AI to help them navigate the new technology without running afoul of copyright law or the Realtor Code of Ethics.
In regards to copyright law, Hecht stressed that, under case law, only works authored by humans — not machines — are protected under copyright law.
When it comes to AI, “the crucial question appears to be whether the work is basically one of human authorship with the computer merely being an assisting instrument or whether the traditional elements of authorship in the work was actually conceived and executed not by man but by machine,” Hecht said.
She pointed to three cases currently making their way through the courts that have to do with AI and copyright. One case, Thaler v. Perlmutter, challenges the idea that only works of human authorship are protected under the federal Copyright Act.
Another case, brought by the author of the novel Zarya of the Dawn, argues that the author is entitled to copyright protection for the images used in the novel even though they were generated by AI because she used the AI as a tool.
“She didn’t just input a prompt and then use whatever was spit out by the AI,” Hecht said. “Instead, she took the image and then asked the AI to change it and revise it and tweak it until the images reflected what she wanted.”
In the third case, Getty Images v. Stability AI, Getty is claiming that Stability AI trained its AI tool on more than 12 million Getty photographs without the company’s authorization.
“That’s a real sticking point for creators right now — the idea that someone developing AI could just use their works to train the system and then the output would based on their works, it could be substantially similar to their works, it could incorporate their works, and this is all done without the copyright owner’s permission,” Hecht said.
“People expect that Stability AI is going to claim that its use of Getty Images was fair use, which is an affirmative defense under copyright law, in which certain copyright infringements are OK or acceptable based on their use … but this is a very narrow, very narrow defense. We’ll see what happens here.”
For NAR members she highlighted two articles of the Realtor Code of Ethics:
- Article 2: Realtors shall avoid exaggeration, misrepresentation, , or concealment of pertinent facts relating to the property or the transaction.
- Article 12: Realtors shall be honest and truthful in their real estate communications and shall present a true picture in their advertising, marketing, and other representations.
“That means that using AI to remove a structural crack in a building in the listing photo, that’s probably going to mean that you’re violating Article 2 and Article 12 of the Code of Ethics by misrepresenting or concealing that crack and not representing a truthful picture of the property in the listing context,” Hecht said.
She contrasted this to, for example, removing a sandbox from a yard or removing a bucket that was accidentally caught in a photograph.
“That’s a little different,” she said. “So I think it’s important to keep in mind your obligations under the Code of Ethics as NAR members when you’re using AI in connection with your real estate businesses in your listing content.”
Hecht also offered these best practices:
- Always review any AI-generated content for accuracy. An AI-generation property description “might sound really nice and help you get started but it might not be accurate,” Hecht said. “So make sure you go back and you’re saying the things you want to say and you’re using AI to help you create this.”
- Make an AI-created work “your own” by changing or adding to it. “If those changes are substantial enough, it might mean that you own rights in those changes,” Hecht said.
- Don’t use AI to create a work that you want to be able to protect. “Right now AI works are not protectable under copyright law,” Hecht said.
- Do not assume any third-party content was created by AI and therefore available for your use. “Always use your best practices for third-party works: Get permission in writing and save it,” she said.
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