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Is Zillow Accurate?

Connectivity and instant information drive our lives today.

We expect to be able to access a resource online, and within moments, receive exactly what we want to know and we take for granted that it’s going to be accurate.

Have you searched for a home on Zillow yet?  Chances are pretty high that you have. It’s estimated that 92% of home buyers will use the internet to help their house search process.[1]  Unfortunately, however, there’s a problem with utilizing automatic-valuation sites like Zillow:

They’re not very accurate.

While Zillow does try to keep up-to-date with it’s information, the fact is, it’s riddled with out-of-date listings. Many have sold years ago!  There are even foreclosure listings that are no longer valid or maybe never even existed! Buyers and sellers may be more empowered then ever with all the resources available on the internet, but they are inundated with inaccurate – sometimes completely false – information

%

Utilize the internet during home search

%

Utilize a mobile app or site in their home search

Can You Trust The Zestimate?

Estimate Example

“What’s my home worth?  What are the homes in my new city selling for?”

These are questions that are often pondered during a home transition, and sites like Zillow®‎ provide a certain appeal:  instant answers to both questions!  Zillow has built their entire business model around it – naming their own brand of estimates the ‘Zestimate(tm)’

What is the Zestimate(tm)‎? It’s a much friendlier name for a system called an ‘Automated Valuation Model’ – or AVM – which uses complex algorithms to process enormous quantities of data in an attempt to predict value.

The Zestimate(tm) is merely a guideline and, many times, is far from accurate.  Each and every market is unique, each house has it’s own personality and every neighborhood has its differences.  The Zestimate(tm) can’t take that into account.  What about a perfectly landscaped lawn?  Or a just-renovated master bathroom?  Or perhaps a finished basement, complete with home theater?

Simply put, it’s nearly impossible for a valuation model to reflect value in a constantly shifting real estate market!

Zillow Doesn't Claim Accuracy

“The Zestimate(tm) is not an appraisal and you won’t be able to use it in place of an appraisal”

We didn’t say that – Zillow®‎ did – it’s right there on their website. They continue with “It’s a computer-generated estimate of the worth of a house today, given the available data…”[2] Market value estimates are exactly that: estimates. They serve as a great starting point during your home buying (or selling!) journey, but should not be relied upon when it comes time to make a decision.

Take, for example, Metro Atlanta. Zillow’s median error percentage is around 7.7%, which means that 50% of the homes bought and sold in this market are within 7.7% of the estimate – while the other 50% fall outside that range.

What’s that mean, though, really? It means that 50% of the time, a house with a Estimate of $300,000 will sell between $276,900 and $323,100. That’s a range of $46,200, and only half the time!

Why You Need a Good Agent

Intimate knowledge of the local market.

That’s the most important need of a real estate agent, and it’s what separates the good from the great. Knowing the market value of each unique area, understanding the little things that make a big difference, and listening to the client’s needs, hopes, and dreams – these are all things that take time, care, and expertise.

Many agents can’t, or won’t, accept this level of commitment, and their clients turn to other services, such as Zillow®‎, to get their needs met.

An expert should be there to help you with one of the largest and most important decisions of your life…

Let us show you the difference at Kenny Realty.

 

Kenny Realty

Citations:


[1] National Association of Realtors (actual link needed)[2] Zillow.com/zestimate/#faq-6