Artificial Intelligence (AI)
We have had many conversations with our appraiser clients regarding the use of AI in their day-to-day business operations. Appraisers should always determine the appropriateness of AI use in an assignment-by-assignment basis; review your order / engagement or service agreement to confirm that your client does not prohibit the use of AI in preparation (research, analysis, and/or drafting) of their report. Maintain USPAP compliance throughout the process, remember that AI is a tool, it will never be a substitute for an appraiser's judgment.
Credible Work Product
When working with AI to produce a report, appraisers must be mindful of their obligation under USPAP to produce a report that is credible and in no way misleading. They cannot simply rely upon AI generated material without ensuring its accuracy. That means double checking and verifying everything they possibly can. At every stage, the appraiser, not the technology, remains responsible for exercising professional judgment, evaluating the credibility of the information and analyses, and ensuring that the resulting opinions and conclusions are accurate and credible. AI does not replace professional judgement, competency, and compliance; the appraiser is ultimately responsible for the content of their work product.
Confidentiality
Appraisers face strict confidentiality obligations under USPAP's Ethics Rule; entering sensitive client data or assignment results into public chatbots or free AI tools can violate professional standards - public chatbots and free AI platforms often use input data to train future models, meaning your typed prompts and client details can be exposed to third parties or other users. Appraisers should verify their AI software privacy settings - opt out of data training (collection of information), and stick to secure, reputable vendors. Appraisers with supervisory authority must also implement reasonable policies, training, and oversight to ensure that any use of AI by a trainee does not compromise client confidentiality or replace appropriate analysis or quality control.
Recordkeeping
Make sure that if your report contains any AI generated content that your work file shows how and to what extent you took steps to verify the accuracy of that content; public records, calls to real estate agents, etc.
Best Practices when using AI
- Avoid entering confidential information into public or consumer-grade AI models; this data is used to train newer AI software and the data can be discovered by other users.
- Treat AI output as raw data or a drafting aid rather than a final professional conclusion; the appraiser is responsible for the credibility of the report.
- Document your workflow, including how and which AI tools were used during research or drafting, to satisfy record-keeping rules.
We recommend you read Advisory Opinion 41, available on The Appraisal Foundation's website.