DETROIT – A bungalow that appears dramatically improved in AI-generated listing photos has reignited questions about trust, disclosure and the role of artificial intelligence in real estate marketing.
In a viral social media post last fall, a renter compared an AI-enhanced image of a Dexter-Linwood bungalow with what the home actually looks like in person, drawing millions of views and prompting reactions from neighbors, buyers and realtors.
“It’s beautiful, but it’s AI,” said Jasmine Jackson, a Detroit resident. “It looks fake. It looks like a painting.”
Local real estate agents say the technology is everywhere in the industry now — from virtual staging and property descriptions to lead generation and even contract drafting — and that raises ethical and regulatory questions.
“Real estate tends to always be, historically always has been a battleground for new technology and it causes a lot of disruption in our industry and AI is no exception,” said Sami Abdallah, broker owner of RE/MAX City Centre in Southfield.
Realtors and metro Detroit residents described the AI images as powerful marketing tools that can also mislead prospective buyers who visit a property expecting what they saw online.
“I mean if that was the only photo that was shown on this listing I would be I’d be pretty, pretty ticked off if I pulled up and didn’t see anything like that,” said Matthew Boileau, an Auburn Hills resident.
Abdallah said his brokerage recently tackled guidelines for AI usage.
“We had a conversation regarding AI staging and editing photo – listing photos using AI,” he said. “And we asked them to always include the original photo.”
Abdallah said AI photos can be used responsibly with conditions.
“We can enhance rooms and colors and furniture,” Abdallah said. “We shouldn’t be enhancing the structure and adding things and removing things that aren’t there.”
He and other industry voices urged national and local real estate organizations and regulators to adopt labeling rules so consumers know when images are AI-generated.
“Absolutely, and I hope that the regulators can catch up, and I’m sure they will, and make that a rule,” he said.
Residents who saw the before-and-after images said the AI result felt deceptive, not just staged.
“Not good. It’s... misleading,” said Brenda Hunter, a Detroit resident. “Very much so, and it looks very much like fraud.”
The property at the center of the debate is owned by the Redstone Group.
According to a Zillow listing, the property is listed off-market for $20,000.
Local 4 learned that a deed indicates a sale last February, though the Detroit Land Bank Authority still holds an interest until the buyer meets the required compliance standards.
Nicole Simmons of the Detroit Land Bank Authority said the agency still technically owns the house until compliance conditions are met, and that being in the land bank’s compliance pipeline does not mean a property is move-in ready.
The agency discourages occupancy until required work is complete and the land bank releases its interest.
Once compliance is reached and the land bank’s interest is released, the buyer or new owner can decide how to use the property, including renting it, Simmons said.
The land bank encourages in-person viewings and careful review of documents for any property, whether formerly land bank-owned or not.
The Redstone Group Local 4 is an affordable housing developer in Detroit that “caters entirely to Section 8 Clients, giving them safe and modern homes to live in. We are great and ethical operators.”
The company explained that the listing and social media reaction were taken out of context.
The Redstone Group had a broker list the property, who then generated the photo in question.
In the property description, the Redstone Group claimed it also disclosed how the house is under renovation and the photos are virtually staged.
“The person who posted that original story either missed the fine print or ignored it,” said the representative.
The posting led to people breaking in to steal doors, windows and furnaces, which is why the group is still under landbank compliance, according to the Redstone Group.
The group said these types of experiences make it very difficult for them to continue to operate in Detroit or continue their business.
The National Trade Association for Realtors has said it “supports responsible AI use in real estate” and has urged Congress to create clear national standards.
Buyers who find a home that looks nothing like its online photos can be left frustrated, agents said.
They worry not only about losing trust but also about liability and the practical fallout of showing clients properties that differ materially from advertised images.
“There are certain things that really require a human touch,” Abdallah said. “If you try to eliminate that human touch you lose trust and it ruins the experience.”