Get ready—Artificial Intelligence is coming to housing.
High-performance housing professionals view the “house as a system” of interdependent parts including building science control layers, mechanical systems and physical components.
My book, “Housing 2.0: A Disruption Survival Guide,” expands this concept to “housing as a system” with a framework for optimizing five interdependent user experiences: community, design, performance, quality and sales. Thus, optimizing performance is critical, but not nearly enough. Success in today’s chaotic housing market requires builders to do much more.
CREDIT: iStock/metamorworks
Since publishing my book in 2021, artificial intelligence (AI) has emerged as a major disruptor across all industries. Given this new reality, it’s time to broaden the Housing 2.0 framework to account for AI’s influence.
The AI applications we’re hearing about most in home construction lean toward automation and quality (e.g., digitization, optimizing materials, reducing waste, and streamlining supply chains). Yet there is a lesser-known AI application which is lighter touch and high reward. It is this less-familiar use case that we will explore today.
To that end, I enlisted the assistance of a trusted partner, my daughter, Monica Rashkin. This article bridges my housing experience and her background at the intersection of knowledge management and AI to demonstrate how the home construction industry can make smarter decisions to navigate today’s murky market conditions.
Initially we will look at a lighter touch AI process to enhance one of the five Housing 2.0 user experiences, the sales process. At the end, we will identify opportunities to apply AI to optimize the remaining four experiences. Whether you are already embracing AI or wary, it will lead to a Terminator-style takeover. I encourage you to buckle in and glimpse what is possible.
We’re not in Kansas anymore.
Housing Sales and the “Paradox of Choice”
Most production home construction companies, to their own detriment, feel obligated to offer extensive homebuyer choices. However, this conflicts with a famous research study from 2000 that examines the impact of choice. This involved two groups of shoppers looking to purchase jam. One group was given 24 varieties and the other just six. To the astonishment of many, the shoppers with 24 varieties were far less likely to make a purchase than those given only six options.
A more recent study had similar findings: more choice leads to greater focus on superficial product characteristics, increased difficulty committing to one option, and lower satisfaction with the final selection.
The accepted explanation for this phenomenon is that less choice reduces burden on our cognitive resources. This concept has become known as the paradox of choice. “Paradox” being the operative word, because it seems counterintuitive that more choice leads to less satisfaction.
But, as mentioned earlier, the production home builders appear addicted to offering homebuyers excess choice. Walk into a new-home sales center on a busy weekend, and a familiar scene plays out repeatedly. Buyers arrive energized, eager to personalize a home to their lifestyle. Early conversations about layouts, efficiency, and features feel empowering. Then, decisions pile up: design options, upgrades, and technology choices accumulate quickly. What once felt like flexibility begins to feel like massive pressure. Buyer confidence fades, appointments run long, and momentum slows.
These outcomes are troubling for an industry already under stress from an epic affordability crisis. This is because excessive choice imposes significantly more business costs and negatively impacts sales by exhausting customers. Research shows a high variety of choice may attract initial interest, but when it comes to actual purchases, limiting options leads to greater confidence and follow-through.
American auto companies learned this lesson when they were offering excessive options selling cars in the 1970s trying to be cost-competitive with foreign auto companies, making major inroads at that time with much more limited customer choice. Eventually, the American car companies followed suit and transitioned to simpler curated bundles of choices for each model car as used throughout the industry today.
Now, instead of cars, consider the stakes of a six- or seven-figure home purchase. The weight of each decision becomes astronomically higher for most homebuyers. And when customization increases perceived risk, companies undermine the very value they sought to deliver.
The "Secret" Sales Floor Knowledge
What makes the paradox of choice so striking for the housing industry is that it surprises almost no one closest to buyers. We are speaking, of course, about sales professionals. They can often predict when a buyer will stall based on the complexity and number of options presented. And in their arsenal of experience, they possess endless horror stories of homebuyer whiplash, couples erupting in intense fights, or buyers simply bursting into tears.
But the knowledge of these sales professionals extends far beyond anecdotes of dread. Their insights form clear patterns based on hundreds of homebuyer interactions. And, their wisdom offers a roadmap of what works, what overwhelms, and where buyer confidence breaks down.
Why Companies Fail to Course Correct
This begs the question: If sales professionals are already aware of the paradox of choice, by experience if not by name, then why don’t companies offer fewer options? The short answer is that the knowledge held by sales staff is largely tacit. Put another way, knowledge lives in their heads. Tacit knowledge is famously under-documented and often stored in scattered formats, including CRM records, call recordings, emails, hallway conversations, and wisdom from years of personal experience.
This dispersed expertise is not easily accessible or actionable. As a result, companies miss important trends that could help the sales process pivot from being reactive, addressing what buyers claim, to being proactive, tackling what actually drives buyer satisfaction. And until recently, extracting meaning from a large volume of inconsistent, unstructured information proved highly impractical. As a result, option sets grew more and more complex at new-home centers, sales cycles lengthened, and buyers continued feeling overwhelmed by choice.
AI-powered insights offer continuous improvement in creating a much smaller strategic set of options that still deliver a personalized home, as well as a shared understanding of what buyers actually need and will pay for.
From Hidden Knowledge to Competitive Advantage
Today, AI systems can effectively analyze large volumes of unstructured data. In doing so, they turn informal institutional knowledge into searchable insights. And enterprise-grade AI platforms can accomplish this while ensuring security. This means the results are restricted to a company’s own data, with enterprise-grade protections keeping sensitive information private.
The “secret sauce” lies in maintaining the discipline to document what teams already know and treat knowledge as a strategic asset. As such, companies that prioritize capture of knowledge, stand to benefit most by unearthing what is actually happening beneath the surface.
So, what types of knowledge should be gathered? Internal data may include sales notes, call transcripts, surveys, or interviews. External sources may include market research, expert conversations, or relevant economic data. Uploaded altogether into a qualitative AI platform, these resources become a living knowledge repository—one that builds a far richer picture than any single dashboard ever could. This is because AI often identifies hidden patterns that get overlooked manually.
This process creates a continuous feedback loop where valuable insights from professionals, like sales staff, flow into AI systems. Then, AI provides outputs that sharpen leadership’s understanding of trends, such as buyer behavior and market dynamics.
For example, by feeding high-quality inputs from sales teams, AI tools are expected to finally bring to the surface the paradox of choice that has plagued so many homebuyers over the years. More importantly, the AI tool can make insights actionable for leadership staff by offering data-informed suggestions to counter homebuyer paralysis (e.g., how to guide homebuyers through a simplified, curated set of options).
Best of all, these same AI-powered insights can inform continuous improvement in many functional areas beyond sales. For instance, design teams can be better informed how to integrate bundled options that simplify buyer choice (instead of overwhelm); marketing teams learn how to create a perception of significant choice with a much smaller strategic set of options that still deliver a personalized home; and the organization as a whole moves toward a shared understanding of what their buyers actually need and will pay for.
Where Humans Still Matter Most
While AI has many strengths, there are two critical areas where humans should never abdicate their responsibility to this technology.
First, humans must validate all the raw data. To attain high-quality outputs from an AI platform, humans must review inputs prior to any upload. They should check the content for accuracy, completion and credibility of sources. This is essential to prevent “garbage in, garbage out.” Ultimately, this step boosts confidence in AI-generated results and makes it easier to identify AI hallucinations.
Second, humans must own the decision-making process. AI excels at synthesis and pattern recognition, but it cannot replace human experience or judgment. People must interpret all AI-analyses and apply their unique expertise to optimize relevant strategies. For instance, builders should ask themselves why trends unearthed by AI exist and then decide how to respond within real-world constraints such as cost and brand considerations.
AI cannot replace human experience or judgment. Builders should ask themselves why trends unearthed by AI exist and then decide how to respond within real-world constraints such as cost and brand considerations.
Other Opportunities
While this article highlights the power of tapping into sales team knowledge, this is not the only group able to provide a full picture for home construction companies. Designers, operations staff, trades, consultants, and other employees each hold valuable insights that rarely get strategically collected or considered. But consider how much more effectively construction companies can respond to market demands when harnessing the wisdom of each of these decision-makers. Decisions become smarter in product selection, pricing, buyer education, and far beyond.
We suggest it is important to consider opportunities to apply a similar light touch AI process beyond sales to optimize Housing 2.0 user experiences:
Community: Optimize plans to provide the most enduring value at the lowest cost (e.g., open spaces, amenities, planning concepts, governance that create the greatest property appreciation).
Design: Optimize how each home lives at lowest cost (e.g., indoors, outdoors, details with the highest willingness to pay compared to cost).
Performance: Optimize compliance with above-code certification programs at lowest true cost (e.g., ENERGY STAR Certified Home, Indoor airPLUS, Efficient New Home, WaterSense, Fortified Home).
Quality: Optimize a path to greater productivity that plans ahead for a shrinking and costlier workforce (e.g., advanced manufacturing options best aligned with preferred designs, targeted performance, risk tolerance, supply chain constraints, and site conditions).
Like it or not, AI is here. And for housing construction companies, let us suggest that sitting on the sidelines is not an option. This article offers a few practical strategies to get you in the game with AI-informed decision-making that is low cost and accountable to results.
Welcome to the future. It’s time to take action.
This Housing 2.0 presentation is sponsored by: Panasonic
Sam Rashkin’s two-decade career as a licensed architect includes serving on national steering committees for the U.S. Green Building Council (USGBC)’s LEED for Homes, Green Builder Media’s Green Builder Guidelines, the Environmental Protection Agency (EPA)’s WaterSense label, and EPA’s Indoor airPLUS label. He has partnered with Green Builder Media to develop the Housing 2.0 program , which empowers building professionals to design and construct higher-performance, healthier and more-sustainable homes at a fraction of the cost.
A Brain Game
Get ready—Artificial Intelligence is coming to housing.
High-performance housing professionals view the “house as a system” of interdependent parts including building science control layers, mechanical systems and physical components.
My book, “Housing 2.0: A Disruption Survival Guide,” expands this concept to “housing as a system” with a framework for optimizing five interdependent user experiences: community, design, performance, quality and sales. Thus, optimizing performance is critical, but not nearly enough. Success in today’s chaotic housing market requires builders to do much more.
CREDIT: iStock/metamorworks
Since publishing my book in 2021, artificial intelligence (AI) has emerged as a major disruptor across all industries. Given this new reality, it’s time to broaden the Housing 2.0 framework to account for AI’s influence.
The AI applications we’re hearing about most in home construction lean toward automation and quality (e.g., digitization, optimizing materials, reducing waste, and streamlining supply chains). Yet there is a lesser-known AI application which is lighter touch and high reward. It is this less-familiar use case that we will explore today.
To that end, I enlisted the assistance of a trusted partner, my daughter, Monica Rashkin. This article bridges my housing experience and her background at the intersection of knowledge management and AI to demonstrate how the home construction industry can make smarter decisions to navigate today’s murky market conditions.
Initially we will look at a lighter touch AI process to enhance one of the five Housing 2.0 user experiences, the sales process. At the end, we will identify opportunities to apply AI to optimize the remaining four experiences. Whether you are already embracing AI or wary, it will lead to a Terminator-style takeover. I encourage you to buckle in and glimpse what is possible.
We’re not in Kansas anymore.
Housing Sales and the “Paradox of Choice”
Most production home construction companies, to their own detriment, feel obligated to offer extensive homebuyer choices. However, this conflicts with a famous research study from 2000 that examines the impact of choice. This involved two groups of shoppers looking to purchase jam. One group was given 24 varieties and the other just six. To the astonishment of many, the shoppers with 24 varieties were far less likely to make a purchase than those given only six options.
A more recent study had similar findings: more choice leads to greater focus on superficial product characteristics, increased difficulty committing to one option, and lower satisfaction with the final selection.
The accepted explanation for this phenomenon is that less choice reduces burden on our cognitive resources. This concept has become known as the paradox of choice. “Paradox” being the operative word, because it seems counterintuitive that more choice leads to less satisfaction.
But, as mentioned earlier, the production home builders appear addicted to offering homebuyers excess choice. Walk into a new-home sales center on a busy weekend, and a familiar scene plays out repeatedly. Buyers arrive energized, eager to personalize a home to their lifestyle. Early conversations about layouts, efficiency, and features feel empowering. Then, decisions pile up: design options, upgrades, and technology choices accumulate quickly. What once felt like flexibility begins to feel like massive pressure. Buyer confidence fades, appointments run long, and momentum slows.
These outcomes are troubling for an industry already under stress from an epic affordability crisis. This is because excessive choice imposes significantly more business costs and negatively impacts sales by exhausting customers. Research shows a high variety of choice may attract initial interest, but when it comes to actual purchases, limiting options leads to greater confidence and follow-through.
American auto companies learned this lesson when they were offering excessive options selling cars in the 1970s trying to be cost-competitive with foreign auto companies, making major inroads at that time with much more limited customer choice. Eventually, the American car companies followed suit and transitioned to simpler curated bundles of choices for each model car as used throughout the industry today.
Now, instead of cars, consider the stakes of a six- or seven-figure home purchase. The weight of each decision becomes astronomically higher for most homebuyers. And when customization increases perceived risk, companies undermine the very value they sought to deliver.
The "Secret" Sales Floor Knowledge
What makes the paradox of choice so striking for the housing industry is that it surprises almost no one closest to buyers. We are speaking, of course, about sales professionals. They can often predict when a buyer will stall based on the complexity and number of options presented. And in their arsenal of experience, they possess endless horror stories of homebuyer whiplash, couples erupting in intense fights, or buyers simply bursting into tears.
But the knowledge of these sales professionals extends far beyond anecdotes of dread. Their insights form clear patterns based on hundreds of homebuyer interactions. And, their wisdom offers a roadmap of what works, what overwhelms, and where buyer confidence breaks down.
Why Companies Fail to Course Correct
This begs the question: If sales professionals are already aware of the paradox of choice, by experience if not by name, then why don’t companies offer fewer options? The short answer is that the knowledge held by sales staff is largely tacit. Put another way, knowledge lives in their heads. Tacit knowledge is famously under-documented and often stored in scattered formats, including CRM records, call recordings, emails, hallway conversations, and wisdom from years of personal experience.
This dispersed expertise is not easily accessible or actionable. As a result, companies miss important trends that could help the sales process pivot from being reactive, addressing what buyers claim, to being proactive, tackling what actually drives buyer satisfaction. And until recently, extracting meaning from a large volume of inconsistent, unstructured information proved highly impractical. As a result, option sets grew more and more complex at new-home centers, sales cycles lengthened, and buyers continued feeling overwhelmed by choice.
AI-powered insights offer continuous improvement in creating a much smaller strategic set of options that still deliver a personalized home, as well as a shared understanding of what buyers actually need and will pay for.
From Hidden Knowledge to Competitive Advantage
Today, AI systems can effectively analyze large volumes of unstructured data. In doing so, they turn informal institutional knowledge into searchable insights. And enterprise-grade AI platforms can accomplish this while ensuring security. This means the results are restricted to a company’s own data, with enterprise-grade protections keeping sensitive information private.
The “secret sauce” lies in maintaining the discipline to document what teams already know and treat knowledge as a strategic asset. As such, companies that prioritize capture of knowledge, stand to benefit most by unearthing what is actually happening beneath the surface.
So, what types of knowledge should be gathered? Internal data may include sales notes, call transcripts, surveys, or interviews. External sources may include market research, expert conversations, or relevant economic data. Uploaded altogether into a qualitative AI platform, these resources become a living knowledge repository—one that builds a far richer picture than any single dashboard ever could. This is because AI often identifies hidden patterns that get overlooked manually.
This process creates a continuous feedback loop where valuable insights from professionals, like sales staff, flow into AI systems. Then, AI provides outputs that sharpen leadership’s understanding of trends, such as buyer behavior and market dynamics.
For example, by feeding high-quality inputs from sales teams, AI tools are expected to finally bring to the surface the paradox of choice that has plagued so many homebuyers over the years. More importantly, the AI tool can make insights actionable for leadership staff by offering data-informed suggestions to counter homebuyer paralysis (e.g., how to guide homebuyers through a simplified, curated set of options).
Best of all, these same AI-powered insights can inform continuous improvement in many functional areas beyond sales. For instance, design teams can be better informed how to integrate bundled options that simplify buyer choice (instead of overwhelm); marketing teams learn how to create a perception of significant choice with a much smaller strategic set of options that still deliver a personalized home; and the organization as a whole moves toward a shared understanding of what their buyers actually need and will pay for.
Where Humans Still Matter Most
While AI has many strengths, there are two critical areas where humans should never abdicate their responsibility to this technology.
First, humans must validate all the raw data. To attain high-quality outputs from an AI platform, humans must review inputs prior to any upload. They should check the content for accuracy, completion and credibility of sources. This is essential to prevent “garbage in, garbage out.” Ultimately, this step boosts confidence in AI-generated results and makes it easier to identify AI hallucinations.
Second, humans must own the decision-making process. AI excels at synthesis and pattern recognition, but it cannot replace human experience or judgment. People must interpret all AI-analyses and apply their unique expertise to optimize relevant strategies. For instance, builders should ask themselves why trends unearthed by AI exist and then decide how to respond within real-world constraints such as cost and brand considerations.
AI cannot replace human experience or judgment. Builders should ask themselves why trends unearthed by AI exist and then decide how to respond within real-world constraints such as cost and brand considerations.
Other Opportunities
While this article highlights the power of tapping into sales team knowledge, this is not the only group able to provide a full picture for home construction companies. Designers, operations staff, trades, consultants, and other employees each hold valuable insights that rarely get strategically collected or considered. But consider how much more effectively construction companies can respond to market demands when harnessing the wisdom of each of these decision-makers. Decisions become smarter in product selection, pricing, buyer education, and far beyond.
We suggest it is important to consider opportunities to apply a similar light touch AI process beyond sales to optimize Housing 2.0 user experiences:
Like it or not, AI is here. And for housing construction companies, let us suggest that sitting on the sidelines is not an option. This article offers a few practical strategies to get you in the game with AI-informed decision-making that is low cost and accountable to results.
Welcome to the future. It’s time to take action.
This Housing 2.0 presentation is sponsored by: Panasonic
By Sam Rashkin
Sam Rashkin’s two-decade career as a licensed architect includes serving on national steering committees for the U.S. Green Building Council (USGBC)’s LEED for Homes, Green Builder Media’s Green Builder Guidelines, the Environmental Protection Agency (EPA)’s WaterSense label, and EPA’s Indoor airPLUS label. He has partnered with Green Builder Media to develop the Housing 2.0 program , which empowers building professionals to design and construct higher-performance, healthier and more-sustainable homes at a fraction of the cost.Also Read