They’ve discovered a new frontier for fraud.
Musicians, authors, and artists have complained about — and some have filed lawsuits against — artificial intelligence (AI) companies that use their creations to train their AI systems. In the real estate world, criminals are using images and videos of actual real estate agents and other housing professionals to train AI models to learn their looks, expressions, sounds and movements. Then, armed with this deepfake model, they impersonate those professionals.
AI tools “make it easier to quickly fabricate correspondence, identification, deeds, mortgages, video, and voices, which can be indistinguishable from a real document or person,” said Sarah Frano, vice president and real estate fraud expert at First American Title. “Given the intrinsic value of real estate, property transactions and mortgages are attractive targets for scammers.
Cara Carlin, director of communications for the Better Business Bureau in Arkansas, says threats to real estate include “AI-generated listings, AI and spider seller personas, generated conversations, and that could be with the property owner or even voice impersonations.” Carlin said there are not a lot of red flags, but people can be on the watch for things that scammers do such as “high-pressured sales, rush transactions, a reluctance from the owner or the agent to meet in person.”
There are multiple types of AI scams the home buyer or seller should know about. The New York Department of State recently warned homebuyers about the use of AI to make photos and videos of properties for sale look better than they actually are.
For its part, the National Association of Realtors is trying to guide the adoption of AI tools to assist real estate agents, but it also has rules about not misrepresenting a property. Matthew Troiani, director of legal affairs at NAR, notes that the associations’ ethics code “prohibits Realtors from exaggerating, concealing or misrepresenting pertinent facts about a property or transaction.” It’s not hard to find examples of agents accused of going too far, but for the most part, when flipping through pictures online showing a property that has been digitally enhanced, there’s a visible note on the image that it was “digitally staged” and the best of them will show both the digitally staged and the unstaged photos, thereby giving the potential buyer a clear image of the property’s actual state as well as ideas about how it can be “zhuzhed up.”
Rental apartments are not immune. A National Multifamily Housing Council survey of apartment owners, developers and managers found that they were already struggling with fraud; 93.3 percent of them reported having experienced fraud in the previous 12 months. AI is going to make that even worse, as it becomes easier for bad players to create convincing fake pay stubs, ID documents, employment confirmation, and other applicant information.
A more dangerous type of AI scam is impersonating an agent, mortgage official, a buyer, or seller as part of an attempt to defraud someone of large amounts of money. It’s nerve-wracking enough to have your bank initiate a wire transfer to the title company for $500,000 and wait until you get confirmation from the title company. It’s worse not knowing if the confirmation itself is coming from an AI-generated fraudster to whom you just sent half a million dollars.
Never send money, deposits, or personal information until you have visited a property in person and met the human agent.
According to First American Title’s Frano, common targets for scams are properties that are not owner occupied, such as a second home, rental unit, or a vacant lot, because the owner is less likely to uncover the scam. “Conversely, while owner-occupied properties are less susceptible to seller impersonation fraud, they may be at a greater risk of scammers taking out fraudulent loans and stripping the property’s equity,” Frano said. “Scammers are after money, not property, so high-equity and mortgage-free properties are attractive targets.”
Closinglock, a software company in the title verification space, issued a report in May, “Data, Dollars, and Deepfakes: How AI Is Changing Fraud in Real Estate.” The report cites a survey in which 53 percent of people “reported sharing their voices online once a week or more.” Cyber criminals can readily pull a person’s voice from YouTube, podcasts, social media, and other readily-available channels. “Just three seconds of audio can create an 85 percent voice match for a deepfake, although scammers usually look for at least 30 seconds of audio for the best fake.”
Detecting AI fraud can be difficult, and the technology is rapidly improving, so it’s likely to get more difficult. This makes it ever-more important to verify identities during transactions, stick to platforms and systems that are verified and trusted, and get title insurance that covers fraud. New York’s Department of State updates the old warning about something being too-good-to-be-true by suggesting people examining property photos and videos carefully, looking for things that are “too perfect,” and suggesting one never send money, deposits, or personal information until you have visited a property in person and met the human agent.
It would be ironic if, in a world that is increasingly digital and remote, the spread of AI gives us more reason for face-to-face, in-person contact.
Headline of the week
“Where Does the British Royal Family Live? Breaking Down the Firm’s $9.5 Billion Real Estate Portfolio”
— By Taylor Herzlich (InStyle)
Go figure
35.3 percent: decline in the price of homes that would be needed to get housing affordability back to its 2019 levels, according to Amherst Group (Fortune) . . . 55 percent: an alternative route to affordability would have incomes rise by more than half, says Amherst; the third option was interest rates to go down to 4.6 percent (Fortune) . . . $4.9 billion: current value of Buckingham Palace in London (InStyle) . . . 32.8 percent: amount of homes sold in the first half of 2025 that were all-cash purchases (Realtor) . . . $338 billion: projected activity level of U.S. luxury housing market by 2030; it is currently about $289 billion (HousingWire) . . . 50 years: length of a mortgage option floated by President Donald Trump that he said could let more people buy homes, but backlash from the right was swift, with Fox News host Laura Ingraham noting “significant MAGA backlash, calling it a giveaway to the banks and simply prolonging the time it would take for Americans to own a home outright” (NPR) . . . The price of fame: Real Housewives of Orange County performer Heather Dubrow shared her advice for another celebrity, Calvin Harris, who accused his former financial advisor of stealing $22.5 million from him in a real estate swindle. Dubrow said she and her husband were scammed out of $2 million in a real estate deal involving their accountant — sort of: ”We put our trust in someone we thought was an accountant who ended up being a tax broker. . . . In our defense, I guess he was vetted by someone famous.” (Realtor).
Say what?
“Pro-housing legislative and administrative actions have failed to markedly increase housing production [in California]. New housing starts were around 100,000 a year when Newsom took office in 2019, and they are about that number today, with the net increase even lower.”
— Dan Walters, “California’s pro-housing laws have failed to raise new home numbers” (CalMatters)