ChatGPT and Beyond: AI’s Role in Modern Homebuilding

Artificial Intelligence (AI) continues to be a buzzword, moving from the subject of movies and science fiction novels to now integrating AI technologies into everyday life and the workplace.

Bassam Salem is the CEO of Atlas RTX, a software company based in Park City, Utah. Al Trellis is the President at the Home Builders Network, a consulting firm based in Eldersburg, Md. Trellis and Salem recently spoke with NAHB about the potential uses, capabilities and limitations of AI within the residential construction industry.

What is “Artificial Intelligence”

While it might seem self-explanatory, it’s worth diving into what the actual definition of artificial intelligence is. Similar to the dictionary.com definition, Salem defines AI as “technology that can automate what would otherwise require human intelligence.” He expands on this idea, calling AI “a big statistical machine that is looking at our content and deriving answers from what we’ve already built.” This encompasses robots and data analysis, along with but not limited to, systems such as ChatGPT that deal with conversation and vision machines able to identify people and content.

ChatGPT is perhaps the biggest trend in AI at the moment. GPT stands for “generative pre-trained transformer.” ChatGPT was created by the company OpenAI, which was founded in late 2015. ChatGPT is pre-trained to generate text information based on a large data set given to it by humans and continues learning based on user interactions. This foundational data does not change without human intervention, as ChatGPT is not connected to the internet. The first ChatGPT model was introduced in June 2018. The fourth and most current iteration was released to the public in November 2022.

What’s the Use

Salem breaks down why we would use AI into two different categories: what humans can’t do and what humans don’t want to do. What we can’t do involves physical limitations such as operating certain machinery, working in extremely harsh environments and the ability to work 24/7. More intellectual skills include knowing hundreds of languages and being able to process data instantly. Trellis believes ChatGPT’s number one asset is its speed and efficiency. “It can prepare things ten times faster than you can,” said Trellis. “Even if you have to spend 25% more time to edit it and review, that’s still three times faster than if you did it from scratch.”

As far as what humans don’t want to do, the list is arguably very long. One subcategory is repetitive tasks. In relation to the homebuilding industry, Trellis believes certain administrative duties relating to customer service, estimating and purchasing will continue to become more automated. Trellis has recently spent time with a homebuilding company to identify 200 commonly talked about topics, such as cracks in concrete and hardwood floor shrinking. AI can write the initial letter to the customer based on the topic, then send it on to be reviewed and edited as needed by human eyes. ChatGPT also has the ability to write administrative documents such as job descriptions and construction timelines. Trellis offered a real-time example for a residential construction superintendent and residential electrical subcontractor. The scope of the work was instantly provided, ready to be altered as needed. ChatGPT was able to create a monthby-month construction schedule for a single-family home on a seven-month timeline. This data can be generated as many times as needed with more complex parameters and additional information.

AI will only become a more irreplaceable tool when it comes to business finances and expenses. Trellis has met a lot of builders he considers to be cost-based pricers versus a market-based pricer. AI can help with dynamic pricing without being hindered by cognitive biases – of which, Trellis points out, humans have been documented to have about 350 of. AI can find patterns and trends that aren’t detectable to the human mind.

This can benefit builders when it comes to sales, pricing and warranties. However, Trellis emphasizes the idea that correlation does not automatically imply causality. A human can look at the data and decide for themselves. “The machine can help up find the correlations,” said Trellis. “Humanity must stay involved for success.”

On the consumer’s side, AI can provide a more personal homebuying experience. Trellis points to AI’s ability to change a website’s appearance based on what the user has already seen and/or interacted with. AI provides the ability to have an instant chat available on a homebuilding website at any time of the day. The timing is especially important, as Salem’s data points to two out of three homebuyer conversations happening after business hours and on weekends. When comparing live chat to an AI supported chat, the same data shows AI results in 5-10 times more conversations and leads captured. This is also a tool to filter down the more serious buyers, saving time for human workers. Additional sales tools include automated follow-up messages on how potential clients felt about a model home and being able to send helpful links. These resources can be provided instantly and in multiple languages as needed.

These automated services provide additional ways to enhance the experience of existing customers. Builders can more easily collect feedback and check in during the building process. It’s easier than ever to send a prompt to write a review, an invaluable asset in the digital age. Or if the customer does need assistance, the problem is brought to the appropriate person’s attention in the timeliest manner.

The Downfalls

As mentioned earlier, ChatGPT has a predetermined set of data it uses to generate additional data. “There is potential for bias in data and algorithms,” said Trellis. “If I had biases when I put the data into the machine, the machine will have the same biases.” There’s also the potential for programs like ChatGPT to generate blatantly wrong information. “The machine can make things up,” said Trellis. “Sometimes it doesn’t know the limits of what it’s supposed to do.” For example, Trellis asked ChatGPT to make an ad for a homebuilder based solely on square footage and the number of bedrooms and baths. The program made up a bunch of stuff about the living room, how much daylight it had and a non-existent dining area adjacent to the kitchen. Trellis also pointed to a situation where a lawyer used ChatGPT to write a brief. This use of AI was quickly unearthed when it was found the precedent cases quoted did in fact not exist.

Job displacement is also a legitimate concern for AI. Certain industries will take advantage of new technology to limit their workforce. For example, out of the approximately 3.3 million truck drivers in America at the moment, Trellis predicts one million of those trucking jobs will be obsolete in 15 years.

It’s still “artificial intelligence” – it’s not human even though it can begin to feel like it. “The evolution of this technology is still in early stages,” said Trellis. AI can help stimulate ideas, but it still lacks human-like intuition and creativity. “The danger is eventually we stop thinking. You want to use the machine as your tool, not the other way around.”