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Zillow.com - A great site to market a home but DON'T believe the "Zestimate" is your true Market Value!

Zillow.comhas become a very popular and heavily traveled website. It started as strictly a market evaluation tool where you could enter your address and get an instant estimate of your homes value or "Zestimate" as the guys at Zillow like to call it.

What has become amazing to me is that a few of the sellers who I have interviewed with have taken this information as gospel. What most homeowners have failed to do is read Zillows disclosure statement. In my area of Massachusetts, Zillows disclosure says that they are within 10% of the market value 66% of the time. This statement in itself is amazing....I don't know about you but I sure don't want to be off by 10% on market value. On a $500,000 dollar home that means the zestimate could be off by $50,000 dollar either way.

When analyzing this disclosure further, 34% of the time Zillow is off by over 10%!! The take home message is that you should always speak with a top Realtor that knows your area well.

I will give Kudos though for Zillow on their marketing efforts. They do have a great site platform that allows you to promote your listings well. The site does draw a lot of traffic and has become another avenue to market homes. I have been marketing all my homes there and have been doing quite well with it.

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Bill Gassett is the team leader for the #2 RE/MAX Team in Massachusetts in 2006. Bill can be reached via email at billgassett@remaxexec.com or by phone at 508-435-5356.

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Posted by Bill Gassett Metrowest Massachusetts Real Estate on 07/12/2007 10:46 PM

Comments (18)

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18 Comments on Zillow.com - A great site to market a home but DON'T believe the "Zestimate" is your true Market Value!

Bill, yeap, I will market there too :) thanks for remember me, I have some new listing to market there, keep the good blog !

07/12/2007 10:48 PM

by Aurora Colorado Real Estate Ray Saenz, Colorado Realtor (United Property Brokers, INC)

I checked out my own house...it wasn't even close...off about $45K

07/12/2007 10:54 PM

by Your Financial Coach

I just posted a listing on Zillow too. I was surprised how easy it was and I think it is a good place that potential buyers will find a listing. But the zestimates are ususally pretty of the true values. I find by self explaining this to many buyers I have been working with. I had a buyer this week that wanted thought a home listed on the market for 1.2 mil was only worth $800k and he wanted to place an offer for $780.

07/12/2007 11:03 PM

by Patrick Canavan - Orange County Real Estate Voice (Prudential California Realty)

Pretty neat tool but the neighborhood I live in also seems to be off by about 10 -15%.

Jeff - Orlando Real Estate

07/12/2007 11:25 PM

by Jeffrey Funk (Realty Executives Central Florida)

Bill,

That's what I also think about Zillow. It's a great marketing tool and well run, but if you want an accurate value for a property, look for it elsewhere. The local MLS is as good as it gets. People who trust these zestimates are unfortunately affected by the sites potent marketing pitch.

07/12/2007 11:28 PM

by Esko Kiuru - Las Vegas NV Mortgage Consultant (Sinifox Financial)

Thanks for all your comments. We just have to keep educating our clients. It is actually pretty easy to show them how far off the accuracy of the site can be. Just looking at the comps they use to determine the value is ammunition enough alone. I have seen spreads in comps by $400K!!! Also if the property is near a town border I have seen them use comps from two different towns.

07/13/2007 06:35 AM

by Bill Gassett Metrowest Massachusetts Real Estate (RE/MAX Executive Realty)

Ther is more than one site doing this. Cyberhomes.com also will give a value to any home in the country. They have over 100,000,000 home records.

I put my own home to the test and cyberhomes.com failed the first time. When I joined and filled in the blanks it did a pretty good job.

Redfin.com RealEstateABC.com PropSmart.com Trulia.com HomeThinking.com and Yelp.com are a few of the web sites poping up with the same information.

We should be watching this - it's a good look at the future.

07/14/2007 03:05 PM

by Lawrence Costa - Your Ocean County Realtor (RE/MAX At Barnegat bay)

Agreed. As agents, we should always be looking at maximizing our clients exposure within the market. These sites are becoming more popular avenues for buyers to do research as well as look at properties.

Redfin, however is a discount brokerage not a marketing portal like the others you mentioned. In fact Redfin is a model that bears watching as they offer consumers 2/3 of the commission back if they are representing a buyer. If you have not experienced Redfin yet, you will eventually. In the few instances that I have delt with them, they have asked me to show their buyer client my listing for them. I have seen other blogs where the debate has been that it should be no problem for the listing agent to do redfins job for them. Absolutely crazy!

07/14/2007 04:04 PM

Sorry I did throw Redfin in there with the rest. Just another business model to follow. Will Redfin give you a greater commission for doing all the work? Or do they just think you'll do it to sell the property?

07/14/2007 04:12 PM

In my own personal experience they did not offer to compensate me. I have read in other blogs that they may do that but who knows. I did show the redfins client because the seller was a personal friend of mine and needed to sell his home real badly. In any other circumstance, I would have made the redfin agent do his job by showing the house or I would have asked for some form of compensation. I guess a good blog topic would be what that service is worth?

07/14/2007 04:45 PM

Real Estate is ever evolving. It's all the same but it's all different.

07/14/2007 05:33 PM

Agreed. As in many things in life there will always be changes.

07/14/2007 05:59 PM

by Bill Gassett Metrowest Massachusetts Real Estate (RE/MAX Executive Realty)

I have checked Zillow.com out. Its a neat idea but I have found that the property values are not exactly right.

07/14/2007 11:51 PM

by Bradley Cohen ABR,GRI (RE/MAX GOLD)

Not at all Bradley but not a bad place to market a home....lots of good exposure as they do get a lot of traffic to the site. Just another good avenue to promote a listing.

07/15/2007 06:27 AM

by Bill Gassett Metrowest Massachusetts Real Estate (RE/MAX Executive Realty)

I love it! My son, the "business guru", thinks that Zillow is the greatest idea since sliced bread. I can't wait 'til the topic comes up again, so I can share these numbers with him. Thank you, thank you, thank you!

07/15/2007 06:32 AM

by Margaret Woda, Maryland Real Estate (RE/MAX VISION)

Well Margaret I would agree with him that they have done a great job in a very short time in becoming recogized. They also have a nice platform for promoting homes. They do lack in the estimating department though. I guess its not surprising given that they have millions of homes being tracked.

07/15/2007 06:41 AM

by Bill Gassett Metrowest Massachusetts Real Estate (RE/MAX Executive Realty)

This is so true! A little extra marketing doesn't hurt.

07/17/2007 10:46 AM

by David Slavin, ABR, SRES RE/MAX Grand, Katy, TX (RE/MAX Grand)

Thanks for the post David. The platform for Zillow has been improved and it is another avenue for us to be promoting homes.

07/17/2007 11:44 AM

by Bill Gassett Metrowest Massachusetts Real Estate (RE/MAX Executive Realty)