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Zillow......Should You or Shouldn't You Trust Their Numbers?

Quite often buyers and sellers will tell me they looked on Zillow and were either disappointed or ecstatic about what they'd found. Trouble is, Zillow does not take ANY factors into consideration, simply tax records. So they don't know that Mr. Smith lives in a home that should be condemned because it's long over due for a home makeover. Or that Mr. Jones has just spent $50k to remodel his kitchen.

Last year a good friend called me up very excited about wanting to sell his home. He proceeded to tell me he'd been on Zillow and it said his house was worth $380k. Even before doing a CMA for him I said I think his house is more likely worth $350k. We did a CMA and sure enough, it came in at $350k for his neighborhood. He was totally deflated about selling his home and didn't understand why it came in less. The reason.....there were much newer, larger homes that had just sold just down the street from his home.

The Seattle Times did a news story and released the following table about Zillow values:

My advice to buyers and sellers........take Zillow with a grain of salt. Use the site as a place to gauge the approximate value of your home. There are many factors that go into determining the fair market value of your home which is why it's important to contact a Real Estate Professional to provide you with accurate information.

Sandy Noll
Realtor, eAgent
Keller Williams Realty
425-890-0878
sandy@sandynoll.com
http://www.letsachieveyourgoals.com
Woodinville, Kirkland, Bothell

Posted by Sandy Noll on 11/02/2007 11:18 PM

Comments (17)

zillow, fair market value, advice, lets achieve your goals

Originally posted at: Sandy Noll.....Real Estate and More: Zillow......Should You or Shouldn't You Trust Their Numbers?

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17 Comments on Zillow......Should You or Shouldn't You Trust Their Numbers?

NOV

2007

Sandy, your graphic is illegible.

Thanks William. I was trying to make it a little smaller so it didn't take up the entire screen, but it just made it worse. So it'll have to be big!

Hello Sandy, Actually for zillow was great as far as buyers. They always showed the homes were worth more than the sale price.

In the end nothing can replace a good professional Realtor.

Hi Sandy,

Zillow being accurate, as far as I'm concerned it's about 50/50. Not good enough for me!

Maria unfortuantely in our area that isn't always the case and then the buyer doesn't understand why the home is "overpriced". Check out all the bottom numbers on the graph in green. Zillow stated the value to be quite a bit less then the sale price. On the last entry Zillow valued the home at $910k and it actually sold for $1.1mil. That seller could have lost $200k if they had just gone with a Zestimate and not used a Realtor. Thanks for commenting.

Lynda I'd have to agree. I cringe when my client tells me they've been to their site. But now I have info like this to show them and not just sound like an insecure Realtor. Thanks for commenting.

You've made a great point. IMHO, Zillow should put in much larger print just how they arrive at their zestimates and they should also make it very clear that they are not appraisers.

NOV

2007

Sandy - I have never been a fan of Zillow, and I doubt that I will start anytime soon. It makes our job more difficult, plain and simple.

Maybe in a few years Zillow may get better, but like Maria said it is hard to replace a good Realtor. People use the Zillow site so they can feel better about their home price, but they are usually setting themselves up for disappointment.

Lanette I totally agree! Thanks for commenting.

Jason it really does make our job more difficult. It was so hard to explain to my friend why there was a $30k discrepancy even though I showed him in black and white. For some reason they think Zillow is right and we have to fight to get them to believe us!

Jeff that's exactly what happened to my friend. He's just now approaching the Zillow zestimate but really turned off at the prospect of selling his house because of his experience. I don't think he doubts me he was just really disappointed when it wasn't what Zillow stated back then.

NOV

2007

Sandy-

Zestimates are a starting point and we are very transparent about the accuracy of our data -- please see our data coverage table here. Nationwide, our median margin of error is 7.2%.

Maria & Lanette - We agree with you that Zestimates are not a substitute for appraisals, nor are they a substitute for a CMA by a local realtor. Appraisals and CMA's are calculated by local professionals who have been to your home and know the local market.

NOV

2007

Hey Sandy!

I've long debated zillow vs a CMA (kudos to Drew for the input regarding the accuracy) with my clients. As you've stated in the blog, so have I addressed with them- Zillow lacks the ability to look forward, only back, and software is not capable of subjective results. This statement has always worked well with those that will her what is said, unfortunately there are always going to be those that think we serve no greater purpose than to rob them of their hard earned equity, and will not believe any argument we provide (I hated using the word "Argument", but my vocabulary ran out of other options!). Zillow does provide for you to input the cost of the improvements you did to adjust the price, however we all know that $50K remodels do not necessarily equal $50K increases to sales price.

NOV

2007

Drew thanks for commenting. Your comments were exactly how I summed up my post. Buyers/Sellers should use the site as a place to begin their quest for the value of a home.

Paul thanks for your input! I did not intend to slam Zillow but rather to educate consumers that the only way to get a true value for their home is to contact a RE professional and let Zillow be a resource that we can work with and make adjustments where needed. Thanks for reading!

NOV

2007

I have a house on zillow right now, they are both over estimated in the Zillow estimate. No, I don't trust the pricing but I do have one friend who has her house listed as Make Me Move. Now that price is funny!

NOV

2007

Jennifer your friend didn't list a price? That is an interesting marketing strategy! Thanks for commenting.

OCT

I totally agree with you, Zillow should only be a guideline. A CMA is the only way to go.

Wow Rich you are digging deep! Let me guess, you're looking for posts? As long as consumers keep the Zillow numbers in perspective, it's a great place to start.

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