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A poll of 250 estate agents from estate agency platform Alto revealed that 87% feel AI-powered valuation tools fail to reflect a home’s true value.
Some 78% of agents rely heavily on AI or automated valuation models (AVMs) when putting a price on a home – and as many as 23% claimed to ‘always’ use them, the study found.
Despite this, 73% admitted they do not even fully trust the tools they are using to make these calculations.
When asked how much they typically adjust AVM-generated valuations, nearly a third [28%] reported changing the figure by £10,001–£20,000, and 10% said they regularly amend valuations by more than £20,000.
This suggests sellers could be losing out on tens of thousands of pounds simply because the original price was set using incomplete or generic data.
Agents also raised concerns about regional fairness. Some 20% believe the tools tend to undervalue rural properties, and 11% think they ‘strongly undervalue’ Northern or lower-income areas.
A spokesperson from Alto, said: “AI is encroaching more and more on so many areas of our lives, but housing valuations isn’t one that usually springs to the front of people’s minds.
“Agents are telling us AI is undervaluing sellers’ homes – and we should be listening.
“These tools can save time and provide a starting point, but they’re no substitute for local knowledge and real-world experience.
“The risk is that homes are priced based on flawed data, and sellers lose out.
“We trust agents – and we believe they should be empowered, not replaced.”
Almost eight in 10 agents (77%) think this technology, at least sometimes, fails to account for key factors that influence a property’s true value.
One area they felt was especially lacking was the algorithms’ abilities to detect added value to a house, in areas such as recent renovations, unique features, or the condition of the property.
Other important elements often overlooked during an evaluation were noise levels (29%), crime rates (26%), and economic conditions (24%).
Especially when considering elements homeowners have invested in themselves, these oversights can be costly – with the most ignored additions being extensions (26%), loft conversions (26%), and smart home technology (25%).
The least accurate valuations were also found to occur in properties in rapidly changing markets (27%), rural locations (23%), and transitional neighbourhoods (21%).
Agents have their own criticisms of these helpers, with the top complaints centering around their lack of accuracy on evaluations generally (23%), but especially when it comes to more unique properties (32%).
However, they also bemoaned the lack of personal touch (21%) and potential for outdated information (20%), limited data sources (18%), and algorithmic bias (17%).
Almost four in 10 (37%) also believe themselves and their fellow agents are prone to overusing this technology.
But two thirds continue to use the AI-driven systems for the prime reason that they save time.
Estate agents in specific UK regions that are most likely to report AI under valuations include the North East (22%), East of England (22%), and Yorkshire and the Humber (21%).
This has led to 11% of agents in the North East saying, on average, they have to adjust AI-generated listing prices by £20,000 or more – underscoring the risk that sellers may unknowingly lose out when marketing their home.
Alto’s spokesperson added: “This just goes to show there are inconsistencies with this technology – across the country and when it comes to specific features.
“We need to ensure that we’re not losing our human touch and that people can trust in their estate agents during a time that can already be incredibly stressful.
“AI has its place, but it should be used to support professionals, not override them.
“Selling your home can be an emotional time and will only be more so if people feel they’re not getting what they truly deserve.”
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