The recent episode (# 162) of The Appraisal Foundation’s “Appraiser Talk” deals with the topic of AI in appraisal. It is worth a listen, though I disagree with most of what the guest, technophilic real-estate appraiser Jim Amorin, asserts, above all, his comment that AI is “like having a crystal ball for the market.”
AI is only as good as as what it scrapes, and we don’t have market data from the future. Appraisers do analyze trends. And yes, technology can help organize data that shows past trends, which at times may provide insight into forecasting future outcomes — though such forecasting may often be tangential to an appraisal assignment with the given task of assessing a past or present value.
While such propensity for pattern recognition is presumably what emboldens Mr. Amorin to feel like he has a crystal ball, one must worry that the machine is not always right, either by virtue of having been trained on an insufficient quantity or type of data, or, critically, because artificial intelligence, certainly in its present form, lacks the nuance for judgement of real human intelligence.
Mr. Amorin’s assertion that “these AI algorithms excel at detecting patterns that might not be immediately obvious to the human eye" has proven, and will, I believe, continue to prove untrue. Perhaps the most notorious recent example was the AI / facial-recognition-driven attempt at attributing a would-be Raphael based on the machine’s detection of a “97 percent similarity” between the figure of this painting and the de Brécy Tondo — the attribution was subsequently questioned by another AI-based team.
Indeed, facial-recognition software might rightly perceive a 97% percent visual similarity between none other than the Mona Lisa and a well-painted copy (of which there are many), but the the 3% difference would presumably cause a 99%+ difference in value.
One must question whether AI, in its present form is at all “very good at analyzing patterns and irregularities,” as Mr. Amorin contends. On the subject of Leonardo, the example in the illustration above came up in the Photos app of my computer — and yes, this is, in fact, a kind of artificial intelligence. The machine’s error of mistaking the Salvator Mundi with a Frida Kahlo self-portrait is certainly funny, but the absurdity of this mistake —ostensibly resulting from insufficient data and training in the model — is also a keen reminder of how flawed, at base, these systems are. (Should we read some deeper meaning into the fact that Photos cropped out the Salvator Mundi’s crystal ball? )
[NB: Similarly problematic statements riddle Mr. Amorin’s self-published book The Generative Shift: Preparing Appraisers for Artificial Intelligence Models Like ChatGPT. While one might be tempted to dismiss a book that has not undergone due editorial process or peer review, it is alarming to see that Amorin’s voice was regarded as relevant enough for his inclusion in the Appraisal Foundation’s recent convocation, “Artificial Intelligence & USPAP Shaping Future Standards and Ethics Forum.” I also recognize that some aspects of real-estate appraisal may differ from those of personal-property appraisal, but we follow the same set of professional standards, and my concerns remain.]