Artificial intelligence (AI) is quickly becoming part of everyday real estate practice. While these tools offer clear efficiency gains, they also introduce significant legal, ethical and operational risks. For brokerage offices, adopting a clear AI policy is no longer optional—it is essential. An AI policy provides a framework for responsible, secure and compliant use of AI across the brokerage. It ensures that agents and staff understand how to leverage AI productively while protecting their clients, the brokerage, and the public. Here are several reasons why it is a best practice to adopt an AI policy for your brokerage:

One of the most immediate risks of AI use is the potential exposure of sensitive information. Many AI tools—especially free or consumer-grade platforms—may store or reuse input data. Without clear rules, agents could unintentionally upload client financial details, transaction documents or personal information into unsecured systems. A brokerage AI policy establishes guardrails such as using only approved, secure AI tools and prohibiting entry of sensitive client data into unapproved platforms. It is also wise to require vendor protections against data misuse or model training. These protections are critical to maintaining client trust and compliance with privacy laws.

AI-generated content can unintentionally create fair housing violations, such as discriminatory language or steering in listing descriptions and marketing. Even subtle phrasing generated by AI can expose a brokerage to legal risk. A well-defined policy requires human review of all AI-generated content and screening for fair housing compliance before publication. The policy might also have restrictions on AI use in targeting or client selection.

Ultimately, agents remain responsible for what they publish, under both the Code of Ethics and license law. AI does not replace professional judgment.

AI can produce convincing but inaccurate or misleading information – commonly referred to as “hallucinations”. Without oversight, this can lead to incorrect property details, misleading marketing materials and improper client communications.

An AI office policy reinforces that AI is a tool—not a substitute for licensed expertise. Human oversight is mandatory for all client-facing and transactional uses. Once again, agents are fully accountable for AI-generated content.

Without a formal policy, AI use becomes inconsistent—often referred to as “shadow AI”—where agents adopt tools independently without oversight. This creates uneven practices, compliance gaps and increased liability. A brokerage-wide AI policy ensures consistent standards across all agents and teams, along with ongoing training and supervision. The policy should provide for centralized approval of tools and vendors.  It might be wise for brokerages to review their errors and omissions insurance policy to determine if it provides additional guidelines or policy limitations related to the use of AI in your real estate practice.

AI can significantly enhance productivity in real estate—but only when used responsibly. A brokerage AI policy is essential to protect client data and maintain professional standards. It should also strive to ensure legal and ethical compliance.  Brokerages that proactively implement AI policies will be better positioned to embrace innovation while safeguarding their business and clients in an increasingly technology-driven industry.

Where should I start? NAR has provided an AI Policy template for members that is available here.