Whether you're looking to buy or sell a home, major real estate sites like Zillow make it seem easy to get a home value estimate. The information is listed prominently when you look up any address or use their search tools, but housing markets are in constant change and there are many variables that factor into a home's true value. For example, if a home has not been sold in many years and major renovations or additions have been made since then, they may not be reflected in the estimate because that information wouldn't be in the public record.
The Problem with Zillow Home Value Estimates
Sites like Zillow have great potential to empower buyers and sellers. Where once the world of comparable sales and real estate values was understood only by real estate agents, now everyday buyers and sellers can learn tons of useful information about area properties, including their own. They no longer have to go to a real estate agent for every little bit of knowledge. The problem is the estimates – or “Zestimates,” as Zillow calls them – are not always accurate. In fact, they can be wildly off, leaving the buyer or seller worse off than before they looked at them.
Zillow may do its best to give you an accurate price of what a home is worth. In the end, though, it is only an automated system that cannot think for itself. It cannot account for variations in any number of things – changes that substantially alter the price from any sort of “average.”
Could the estimations be better programmed to account for this stuff? Definitely. But we are not dealing with the ideal Zillow; we are dealing with it as it is now. When you are trying to buy or sell, you cannot afford to be off by tens of thousands of dollars in your pricing or your bidding.