More Than Half of Homebuyers Now Start Their Search With AI

The way people begin looking for a home has changed dramatically in just the past year. According to recent research from Veterans United Home Loans, 45 percent of prospective homebuyers now use artificial intelligence tools during their search, up from 37 percent in mid 2025. Even more striking, a 2026 analysis from AI search firm FlyDragon found that more than 60 percent of buyer side real estate searches now start through AI interfaces like ChatGPT, Google Gemini, or voice assistants rather than traditional listing sites.

The shift is most pronounced among younger buyers. According to Bank of America Homebuyer Insights Report released this summer, 32 percent of Gen Z and 28 percent of millennials have used AI tools to support their home search or financial planning. But here is the interesting part: while buyers are leaning on AI for research and education, they are not using it to replace real estate professionals at decision time. Three out of four buyers expect AI to be embedded somewhere in the process, according to property data firm Cotality, but 44 percent say they would pay someone to verify AI decisions.

The most common use cases are practical and specific. According to the Veterans United survey, 52 percent of buyers use AI to search for available homes, 43 percent use it to estimate monthly mortgage payments, and 39 percent use it to check property values during their search. About a third turn to AI as a mortgage calculator or to learn about housing trends, while 30 percent use it to shop for the best interest rates.

The appeal is speed and accessibility. Tasks that used to require calling a lender or waiting for an agent to pull numbers can now happen in seconds. Buyers describe using AI to compare neighborhoods, understand what fits their budget, or get quick answers to questions they might feel embarrassed asking a human. The technology is filling an education gap, especially for first time buyers who need to build confidence before reaching out to professionals.

Here is the challenge: while buyers are starting their search with AI, most real estate professionals are invisible in those early conversations. The FlyDragon analysis found that fewer than 10 percent of agents appear in AI generated responses when consumers ask location based questions about real estate professionals. That means when someone asks an AI tool to recommend agents in Southern Indiana or explain the local market, most agents simply do not show up.

The platforms buyers assume are using AI include property websites at 86 percent, lenders at 80 percent, and real estate agents at 80 percent, according to Cotality. Buyers expect their agents to be fluent with these tools, even if the agent is not actually using them yet. That expectation gap is worth paying attention to.

If you are planning to buy a home in the next year or two, AI tools can be genuinely helpful for early stage research. Use them to estimate what you can afford, compare mortgage scenarios, or get a feel for inventory in different Southern Indiana communities. But treat AI as a starting point, not a decision maker. The technology can hallucinate facts, mishandle local nuances, or miss details that matter in specific neighborhoods.

Verify everything with a local professional who knows the market. When you are ready to move from research to action, work with an agent who understands both the technology and the human side of the transaction. The best outcomes happen when buyers use AI to get smarter faster, then bring that knowledge into a real conversation with someone who can help them navigate the complexities that algorithms still miss.

Even as adoption climbs, trust in AI has actually dropped. According to research from Cotality, trust in AI to help find a home fell from 30 percent in 2025 to just 16 percent this year. Buyers want what Cotality calls a human in the loop. They appreciate the speed and convenience AI offers for research, but when it comes to making one of the biggest financial decisions of their lives, they still want a real person verifying the details, explaining the context, and guiding them through the process.

That is good news for buyers and agents alike. The technology is not replacing relationships. It is changing where those relationships begin and what buyers expect when they walk through the door. The agents who will thrive are the ones who meet buyers where they are, acknowledge the research they have already done, and add the local insight and human judgment that no algorithm can replicate.

As of late July, mortgage rates are holding in the mid-6% range. The 30-year fixed rate sits at 6.62%, the 15-year at 5.98%, and the 5/1 adjustable at 6.46%. For anyone shopping in Southern Indiana's competitive neighborhoods, these rates represent a modest improvement over just days prior, which means a slight boost to purchasing power.

Buyers should recognize that in a market where rates can shift with economic news, locking in financing sooner rather than later often makes practical sense. Even small movements in rates affect your monthly payment and overall loan cost, so if you've been on the fence about purchasing, this window is worth discussing with a lender and a local agent who understands your neighborhood's specific conditions.