The hidden costs of free AI advice

In the digital economy, few things are as enticing as free services. Consumers, bombarded by AI-driven insights, often believe they are gaining access to sophisticated, data-backed advice at no cost.

There are legitimate reasons for start-ups to try to gain traction and users by offering free AI services, but if the advice is paid for by someone else and offered to consumers free, then sometimes free comes at a cost.

As with all things free, the true cost often lies beneath the surface. Nowhere is this more evident than in the property sector, where AI-powered platforms claim to democratize homeownership and real estate investing. But as with any financial advice, one must ask: whose interests are truly being served?

Homebot.ai exemplifies the risks of relying on ostensibly free AI-driven property guidance. It presents itself as a consumer-focused service, yet it has clear economic incentives that may subtly steer users toward transactional behaviours that benefit the platform's true customers—mortgage brokers and real estate agents.

Homebot: A Bias Toward Transactions?

By the time the average American retires, approximately 83% of their wealth is tied up in home equity. Managing this asset prudently can mean the difference between a comfortable retirement and financial insecurity.

Homebot positions itself as the answer, promising personalized home finance insights that empower consumers to make better decisions about refinancing, selling, and purchasing homes.

Yet, beneath the veneer of consumer empowerment lies a more transactional motive. Homebot is fundamentally a lead generation tool for mortgage brokers and real estate agents, who only make money when a user acts on the AI's insights. The subtle bias toward transacting—whether through refinancing, buying, or selling—triggers taxes, fees, and commissions that can erode long-term returns. While AI can highlight beneficial financial maneuvers, it is programmed to prioritize actions that generate business for the professionals funding the platform.

The smarter approach to homeownership often involves patience—buying and holding over time, minimizing unnecessary fees, and leveraging equity strategically. However, Homebot’s design tilts toward nudging homeowners into making moves that serve the financial interests of lenders and agents rather than property owners.

An Alternative: Aligning Incentives with Wealth Growth

The Homebot example illustrates a broader issue with free AI-driven financial advice: the economic model behind these services is often structured to encourage transactions, not necessarily to maximize consumer wealth. Property ownership should be approached with a long-term perspective, favouring strategies that build sustainable wealth rather than generating commissions for intermediaries.

A better model may lie in platforms designed to serve fee-based wealth managers, who are compensated based on the overall growth of a client’s wealth rather than the volume of transactions executed.

Companies like Properti Edge (propertiedge.com) see an opportunity in this space—leveraging AI not to drive transactions but to empower investors to make more holistic, long-term property wealth decisions. With incentives aligned to wealth creation rather than deal flow, the promise of AI in real estate can truly be realized.

Consumers should remain cautious: in an age where data-driven insights are freely offered, it is essential to ask who is footing the bill—and what they stand to gain from your next move.