Have you ever wondered about those “Zestimates” from Zillow.com ? How accurate are they really?
I pondered this recently, as a listing I have coming on the market in Hunt Valley has a Zestimate about $40,000 LESS than the value determined during my true, in-depth market analysis as a licensed Towson Real Estate Agent. (On the other hand, using their “My Estimator” tool brings the value up to over $110,000 HIGHER than its true value!)
With a closer review of the Zillow site, I was able to find some interesting accuracy statistics about the Towson Home Price Zestimate averages (per Zillow.com):
- Zestimates within 5% of actual sales price (actual home sales) : 30%
- Zestimates within 10% of actual sales price (actual home sales) : 50%
- Zestimates within 20% of actual sales price (actual home sales): 71%
- Median Error: 10%
Here is the actual verbiage from them, which helps me understand the inaccuracy:
Data Coverage and Zestimate® Accuracy
The home data we have compiled to generate a Zestimate home valuation varies by location. Some counties provide all the data we could hope for, but others are lacking such key things as the number of bedrooms and bathrooms, or, in some cases, the square footage of the home. The more data we have, the more accurate the Zestimate. And, we’ve made it easier for our users to help us improve accuracy by incorporating edited home facts into our Zestimate calculations. In some areas, we might not be able to produce a Zestimate at all, but we do have some basic information on the homes.
When I stopped to think about it, I realized that the site does not have correct information because Baltimore County has not provided it to the public about the square footage, number of baths, the fact that it has hardwood floors throughout, a finished basement, and other imperative details when determining a Hunt Valley House Value.
As an example, if there is a home in Towson with the correct value of $300,000, 71% of the time the Zestimate could price the home as low as $240,000. Can you imagine being a seller viewing that info? Or how about a buyer, if it were 20% ABOVE? Would you, as a buyer, be happy with paying $360,000 for this home?
Zillow.com even acknowledges the importance of getting a comprehensive market analysis from a qualified local real estate agent. To get your free Towson Home Price Estimate, call me!
I think you make really good points in your article. I think that pricing a home- particularly when the market is volatile, as it has been for us- is much more art than science. Of course, the list price suggested is based on hard data, but what the human element (the agent) does is take those numbers and put them into context. Is the market softening? Then if you want that home sold, you had better be leading the market with your price. The agent can help you there. Are there small improvements or staging tips that will bring you a large return for a minimum expenditure? Your agent can help with that, or point you in the right direction.
A Zestimate is just that: a Zillow estimate. You can’t “Blue Book” a house. There are too many variables involved that need to be put into context.
Marney–Great article about Zillow estimates. I have always been suspect. I just now plugged in a Rodgers Forge property that I am very familiar with, and in this case, it was al least $40,000 under the actual market value!
Buyers and sellers beware of using this information from this site in any meaningful way. As Zillow says in their disclaimer, you need to contact a real estate professional for accurate , current information. Very timely article–thanks Marney!–Jean Ottey, REALTOR, YWGC
Absolutely true. And what of the uncrunchable unzillowables?
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