How Accurate Are Zillow Home Value Estimates

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Transcript

1. How Accurate Are Zillow Home Value Estimates? http://dcrealestateguru.com/how-accurate-are-zillow-home-value-estimates/
2. When Zillow first launched in 2005, it shook the real estate industry for its ability to provide instant appraisals
3. Zillow’s search engines allows users type in an address and see an estimated value of any home
4. More people began to trust Zillow and it grew to become an indispensable tool for homebuyers and sellers
5. As a REAL ESTATE AGENT, my clients often ask me about the accuracy of the Zillow home value estimates, which Zillow calls “ZESTIMATES”
6. Why You Can’t Trust Zillow Home Value Estimates
7. Zillow’s estimates come from an automated system Doesn’t have the ability to think for itself
8. This is the reason why oftentimes its home value estimates can be wildly off Sometimes to the tune of thousands of dollars
9. Because Zillow is a system, it can’t take into consideration variations in the property that would differentiate an average home to a renovated home full of upgrades
10. Margin Of Error And Formula Used
11. On its website, Zillow claims that it has a median error rate of 5%. They also claim that the “Zestimate” are merely starting points that can be used to determine the actual market value of a property
12. The Zillow system uses algorithms that consider Property tax assessments Recent sales User-submitted data
13. How Zillow Determines The Market Value Of A Home
14. One of the biggest problems about the formula used by Zillow is that it takes into consideration a home’s assessed value But the truth of the matter is that a home’s assessed value rarely has any correlation to market value
15. Why Zillow Estimates Can’t Be Relied On
16. Zillow estimates may actually work Discrepancies as much as 50% higher than actual market value
17. Knowing how much nearby homes sold for is also important in both buying and selling These numbers, known as comparable sales, are a major deciding factor when real estate professionals price a home
18. Considering comparable sales needs a human aspect to it For example, if you are living in an area where all the homes are similar, same price range, and none have been renovated, then this is a scenario where you can apply comparable sales without analyzing other factors
19. Never Rely Solely On Zillow As A Buyer Or Seller
20. Buyers and sellers should never rely on the Zillow tool alone Even the website itself tells you that the estimates are only a starting point
21. Why Realtors Are Still Indispensable
22. Despite the popularity and prevalence of online real estate tools such as Zillow, it’s important to know that these systems can’t replace the work of realtors Real estate professionals use different methods to appraise the value of a home, and can even provide critical insight on how one comparable sale plays a role in appraising the next property
23. These figures will come as a shock to the seller, especially when they are presented with figures that are as much as $50,000 lower than what Zillow says their home is worth. See what I mean? Realtors also complete a comparative market analysis (CMA) when appraising a home The data used by Zillow is far too broad
24. You Still Need An Agent For Accuracy
25. Every home seller and buyer needs to understand that Zillow is a system tasked with estimating hundreds of millions of homes across America Simply impossible for them to accurately know the exact value of each of those homes
26. How You Can Make The Most Out Of Zillow
27. The Zillow website is very well built, and all the features can come in handy to buyers, sellers, and real estate agents EXCEPT the Zillow estimates Zillow has excellent integration with Bing maps Information about a property Bedroom count, lot size, age, and square footage
28. The Final Word On Zillow
29. Zillow might not be able to provide true market value of a home, the estimates can serve as a good starting point
30. Zillow will never be able to replace the job of a professional realtor in providing good insight and more accurate values
31. Contact me for a more thorough evaluation of your home www.dcrealestateguru.com/sellers