Are Zestimates Accurate?
Zillow - Are Zestimates Accurate?
Zestimate is the value that Zillow gives your home. You can get your home’s value in the time it takes to type in your address. Zillow uses their Zestimate tool to make money.
Zillow uses their Zestimate tool to make money. That’s right … Basically, Zillow sells your information back to realtors who want to help you sell your home. That’s how Zillow can afford to provide you with the great tools that they have on their website. But those tools are often inaccurate.
Actually, a lot of companies have tried to create automated property valuation tools but because of how different one home is from another, no one has been able to create an accurate one.
Zillow’s algorithm crunches the sales prices that supposedly similar properties in the same geographic area as yours. Then they take an average of those prices to come up with a price for your property. BUT … here’s the thing … the Zestimate can’t tell if you’ve remodeled your kitchen, if your home is custom with high end features, or just a basic square box with no thrills. It cant tell if your home has been well maintained or if you’ve got some 1970s green shag carpet and yellow Frigidaire appliances … you know what I’m talking about .. right?
Here's what it boils down to … If your home is relatively new, like new enough that no one in the neighborhood has likely done any remodeling, and your neighborhood was built by a production builder, meaning, that they had a limited set number of floorplans with limited options that you could choose from, then your zestimate is likely fairly accurate, IN A BALANCED MARKET. More on that in a minute.
If your home is older or a custom-built home or is surrounded by custom built homes, or there are homes in your area that are very different from yours, you likely can’t trust the zestimate. It could be a lot higher or a lot lower than your actual value. Call a realtor and get your opinion on your home’s value.
But wait! There’s more! When markets are strongly favoring the buyer or the seller, the zestimate might be inaccurate regardless of the type of home you have. In a balanced market, home prices depend on what’s recently sold. And the zestimate is based on recently closed sales.
A large part of determining probable sales price is what is active on the market at the time you list your home. If a home like yours is in high demand, and when it goes active, there are very few other homes like it to choose from, you may want to list above the recently closed sales. Similarly, when a market is leaning strongly towards a buyers’ market, you may not get as much as someone who sold before you did.
I hope you found this information useful. Thanks for watching and don’t forget to subscribe.