Online valuation analysis of a home - how accurate are they?

By
Real Estate Agent with Progressive Realty (Boise Idaho) www.Progressive-Realty.info DB-17066

My clients are always asking me about the accuracy of their “online evaluations”.  After reading several articles about the least expensive home in San Francisco (16 De Long Street offered at $350,000, I decided to pull up various online web portals that offer price estimates to see what their predictions were.  It was listed for $350,000 and sold for $408,000 after receiving multiple offers! It was listed for $350,000 and sold for $408,000 after receiving multiple offers!

Here are a few screen shots from various websites showing their estimates for 16 De Long Street, San Francisco, CA:

 

ZipRealty:


The moral of my story is if online valuations were even close to accurate, the banks wouldn’t request a bank appraisal for their mortgage loans.  Also, if online valuations were accurate, you wouldn’t need an appraiser’s license either, you could just attend a webinar and call yourself a professional.

For example, Zillow.com shows their margin of error for their Zestimates.  You should check out the accuracy they claim in your market area.  You will see that here in Idaho, they give themselves only a 1 out of 4 star rating since they admit “ = Tax assessor's value, or unable to compute Zestimate accuracy”.

 

Please take online valuations with a grain of salt and dismiss price per square foot analysis while you are at it.  You really need to look at the type of property, it’s condition, if it is currently the highest and best use for the property, factor in the depreciation and determine cost benefits of remodeling, etc. to determine the market value based on all of the above!

close

Re-Blogged 1 time:

Re-Blogged By Re-Blogged At
  1. Joan Cox 05/05/2016 09:58 PM
Topic:
Real Estate General Information
Groups:
Active Rain Newbies
Realtors®
The Art Of Marketing You
Tags:
zestimates
online valuations
what is my home worth
free market analysis
boise homes for sale
jim paulson progressive realty corporation
selling my home in idaho
least expensive home in san francisco

Spam prevention
Show All Comments
Ambassador
3,042,859
Anna Banana Kruchten CRS, CRS, Broker, Instructor
HomeSmart Real Estate BR030809000 - Phoenix, AZ
602-380-4886

Jim and the mis-information continues and goes on and on and on and the general public thinks it's the gospel truth.  So not so.

Mar 08, 2016 08:59 AM #1
Rainmaker
4,444,924
Joan Cox
House to Home, Inc. - Denver Real Estate - 720-231-6373 - Denver, CO
Denver Real Estate - Selling One Home at a Time

Jim, cannot see why this post did not get FEATURED, as it is so true.   Homeowners start this and determine what their home is worth, and is often so wrong.  

Mar 26, 2016 01:10 AM #2
Rainmaker
303,420
Jim Paulson
Progressive Realty (Boise Idaho) www.Progressive-Realty.info - Boise, ID
Owner,Broker

Thanks for the positive reinforcements.  I think we will be fighting this battle for many years to come.

Mar 27, 2016 08:09 AM #3
Rainer
23,054
Erica Love
Brokers Guild Cherry Creek - Colorado Springs, CO

This is a GREAT post! Very interesting ! I am going to have to go check out the margin of error on their site for my area.

May 05, 2016 10:59 PM #4
Rainmaker
3,569,204
Nina Hollander
Coldwell Banker Realty - Charlotte, NC
Your Charlotte/Ballantyne/Waxhaw/Fort Mill Realtor

This is deserving of a feature and exposure to all those home owners out there who believe AVM's, regardless of the source are more accurate than what an experienced agent tells them.

May 06, 2016 02:55 AM #5
Ambassador
4,298,371
Jeff Dowler, CRS
eXp Realty of California, Inc. - Carlsbad, CA
The Southern California Relocation Dude

It really is true, and we see discrepancies in AVM data time and time again, and with often dramatic differences, as you have shown. Why anyone would consider this accurate information or make any buying or selling decisions without getting some reliable information from someone who really know, is beyond me. Except it's simple, quick, and maybe even fun! Who cares if it's right or not

May 06, 2016 04:16 AM #6
Rainmaker
303,420
Jim Paulson
Progressive Realty (Boise Idaho) www.Progressive-Realty.info - Boise, ID
Owner,Broker

I guess I should be more optimistic - at least my state (Idaho) got a one star rating from Zillow.  Guam didn't even do that well, they don't even get a star.

May 06, 2016 04:53 AM #7
Rainmaker
3,734,609
Michael Jacobs
Pasadena, CA
Los Angeles Pasadena 818.516.4393

Hi Jim --- I love to speak about online valuation with clients ---- the topic typically sparks some good conversation and I get an opportunity to discuss the facts and how market value is determined.  Good post -- I'm glad Joan Cox reblogged it.   

May 06, 2016 05:20 AM #8
Rainmaker
4,432,971
Gita Bantwal
RE/MAX Centre Realtors - Warwick, PA
REALTOR,ABR,CRS,SRES,GRI - Bucks County & Philadel

Thank you for the post. I will bookmark this and share it. 

May 06, 2016 08:41 PM #9
Rainmaker
303,420
Jim Paulson
Progressive Realty (Boise Idaho) www.Progressive-Realty.info - Boise, ID
Owner,Broker

Thank you all for your positive feedback.

May 07, 2016 03:42 AM #10
Show All Comments

What's the reason you're reporting this blog entry?

Are you sure you want to report this blog entry as spam?

Rainmaker
303,420

Jim Paulson

Owner,Broker
Put my A+ BBB rated service to work for you by calling me now!
*
*
*
*

Additional Information