Will AI Price You Out of Your House?
Written by
Chris Adam
Edited by
Amen Oyiboke
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The competition for power is on. With artificial intelligence ramping up and the big data centers that support them coming online, the competition for power is driving up energy bills for industry and consumers, according to The Daily Upside.
The situation is leading some experts and homeowners to ask the question: Will AI price people out of their homes?
Housing and financial experts told GOBankingRates the answer is probably not simple.
A ‘Significant Demand’
“AI data centers place a significant demand on the power grid, which will drive up the price of electricity, and the average American is likely to experience the most disruption from the higher prices,” said Melanie Musson, a finance expert with Quote.com. “The data centers will pay whatever it takes for electricity. It won’t make a difference. However, the homeowner who has double the cost of electricity may struggle to maintain their lifestyle.”
Long-Term Affordability
“I’ve begun to consider energy expenses in the same manner that consumers consider commute times or school districts,” said Taylor Szostak, realtor and founder of San Diego Military Real Estate. “Although they don’t often make headlines, they have a significant impact on long-term affordability.
“I’m already witnessing people attempting to make plans start talking about utility expenses as data centres draw more power from the grid. Increased monthly costs may affect a buyer’s eligibility, particularly for VA borrowers who require precise, predictable spending.”
Increased Energy Costs
“AI is changing a lot more than people realize,” said Taylor Kovar, certified financial planner and CEO of 11 Financial. “Those huge data centers that run AI systems use an incredible amount of power, which drives up demand on the grid. As energy costs rise, it filters down into everything — homebuilding, utilities and even property values in some areas.”
If energy becomes more expensive or harder to access, Kovar noted, new developments could slow and existing homes could become pricier to maintain. He said it’s something worth watching, especially if you’re looking to buy or build. Keep an eye on local energy projects and utility rates, because those small changes now could play a big role in housing costs down the road.
Need for Knowledge
“AI is undermining the housing market in new and troubling ways that most of us don’t even realize,” said Gagan Saini, a real estate expert at JIT Home Buyers. “Institutional investors now use AI to analyze and buy homes in seconds, frequently before a regular buyer has even had a chance to see them. What’s more, dynamic pricing algorithms could drive up home prices based on real-time demand, much like airlines price tickets.”
Saini said that for regular buyers, that means homes could sell more quickly and for higher sums of money. “AI tools can help buyers find deals sooner, estimate property values more accurately and negotiate smarter. The trick is to learn how to use AI for your own purposes and not be priced out by it.”
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