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    What’s the Deal With Zillow’s Zestimates?



    According to Web metrics firm Experian Hitwise, in July 2012, Zillow.com was the top-ranked real estate search website, so I’m guessing if you own a home, are thinking about buying a home, are thinking about selling your home, or just love real estate, you’ve probably visited the site once or twice. That means you’ve probably heard of the Zillow Zestimate.

    According to Zillow.com: “The Zestimate (pronounced ZEST-ti-met, rhymes with estimate) home valuation is Zillow’s estimated market value, computed using a proprietary formula. It is not an appraisal. It is a starting point in determining a home’s value.”

    Even Zillow itself admits that the metrics they use to calculate Zestimates is not always accurate. Keep that in mind when you are looking at the Zestimate for your own home or when looking at the homes for sale in the surrounding neighborhoods. But also remember that Zillow’s Zestimates can come in very handy – just be sure that the property information on matches the home’s listing sheet in the MLS to be sure all the details are correct.
     

    HERE ARE A FEW THINGS TO CONSIDER WHEN LOOKING AT A HOME’S ZESTIMATE:

     
    The information about the home may not be correct, which may affect its Zestimate. Zillow pulls information about each individual home from public records and data. Some of the information may be incorrect or out of date. For example, if the owner has built an addition on the home, that extra square footage may not be reflected on Zillow.

    The features of the home may not be updated. Most public records (tax records, appraisals, etc.) do not list cosmetic improvements and upgrades, like hardwood floors, stainless steel appliances, etc. When you view the home in person, you may notice features and upgrades that are present in the home but not up-to-date on Zillow. Make note of those items when considering the accuracy of the Zestimate.

    The seller/homeowner and listing agent can edit the home’s information. Just like a listing in the MLS, Zillow entries are subject to human error. A mistake in the data – whether intentional or not – can affect the Zestimate, putting the home at an advantage (or disadvantage). Further proof that it is always a good idea to (a) see any home you are considering purchasing in person to notate the features, upgrades, and details for yourself, (b) ask your REALTOR® to do a Comparative Market Analysis on any home you are considering, in order to get a better idea of what the home should sell for based on recent comparable sales and other pertinent data, and (c) when in doubt, consult a real estate appraiser, who can complete a Market Value Appraisal for you and help you decide if the price you’re willing to pay is a realistic one.

    If you are a HOMEOWNER, you can correct the information and add additional details about your home by claiming it on Zillow.

    HERE’S HOW – CLICK HERE FOR STEP-BY-STEP INSTRUCTIONS!

    If you are a BUYER and you are using Zillow to look for available homes, keep in mind that some of the homes that show on Zillow as being available may actually already be sold. Consult with your REALTOR® about the availability of homes that you find on Zillow and to help you schedule a private showing of homes you are interested in.

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    3 Responses to “What’s the Deal With Zillow’s Zestimates?”

    • Jay Thompson

      Written on

      Hey Maura, Jay T from Zillow here!

      Thanks for the “fair and balanced” look at Zestimates! I’m a little biased obviously, but I do think Zestimates are a great starting point (followed up, naturally, with a visit to your friendly real estate professional!).

      Reply
    • Zillow: A REALTOR’s View on How You Should Use Zillow for Your Home Search

      Written on

      […] Zillow’s Zestimates are not necessarily an accurate representation of the value of a home. Zillow itself is very clear  that their “Zestimate” tool is not to be considered a substitute for market analysis by a REALTOR® or an opinion of value by a licensed real estate appraiser. There is a distinct margin of error in their formula, which varies by state and market area. For example, the Metro Atlanta area only receives 2 of 4 stars for accuracy from Zillow with a 9.2% Median Error in Zestimates. Keeping this in mind, as a consumer, will begin to help you understand that, while the Zestimates can be helpful they should not used in lieu of a local professional real estate agent’s market knowledge. (For more information on what makes up a Zillow Zestimate, please click here.) […]

      Reply
    • How to Use Zillow for Your Home Search

      Written on

      […] Zillow’s Zestimates are not necessarily an accurate representation of the value of a home. Zillow itself is very clear  that their “Zestimate” tool is not to be considered a substitute for market analysis by a REALTOR® or an opinion of value by a licensed real estate appraiser. There is a distinct margin of error in their formula, which varies by state and market area. For example, the Metro Atlanta area only receives 2 of 4 stars for accuracy from Zillow with a 9.2% Median Error in Zestimates. Keeping this in mind, as a consumer, will begin to help you understand that, while the Zestimates can be helpful they should not used in lieu of a local professional real estate agent’s market knowledge. (For more information on what makes up a Zillow Zestimate, please click here.) […]

      Reply

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