Zillow Zestimates may be inaccurate again and again in Baltimore.
Zillow Zestimates. Buyers often look to them, thinking they are a good representation of a home’s value.
In reality, often (not always, but often,) Zillow Zestimates can be off. Especially in Baltimore County.
This happens across the country. The Los Angeles Times published an article regarding this very topic. A few paragraphs really struck a chord with me, like:
Shoppers, sellers and buyers routinely quote Zestimates to realty agents — and to one another — as gauges of market value. If a house for sale has a Zestimate of $350,000, a buyer might challenge the sellers’ list price of $425,000. Or a seller might demand to know from potential listing brokers why they say a property should sell for just $595,000 when Zillow has it at $685,000.
The median error rate across the US is about 8%. Think about that. On a $400,000 house, that is $32,000 — in either direction.
But again, that is just the median error, across the US. Each area has its’ own rate.
According to the LA Times article, here are some of the larger error rates:
For example, in New York County — Manhattan — the median valuation error rate is 19.9%. In Brooklyn, it’s 12.9%. In Somerset County, Md., the rate is an astounding 42%. In some rural counties in California, error rates range as high as 26%.
42%? 42%! That is just…well…way off.
For Baltimore, MD currently, it is listing at 8.4%.
Here are the more important #s to review, though.
Look at the chart straight from Zillow’s website (current as of May 1, 2016.)
Zillow’s Zestimates in Baltimore are within 5% of a final sale price 33.7% of the time. The Zestimate is within 10% of a final sale price in Baltimore 56% of the time. It is within 20% of a sales price 76.7% of of the time.
Let’s review those stats using a $400,000 final sale price on a house. A Baltimore Zillow Zestimate is only within 20% of a final sale price 76.7% of the time. Zillow Zestimates are within $80,000 of a $400,000 sale price only 76.7% of the time. That also means that 23.3% of the time, the Zestimate would be more than $80,000 off on that home.
The Zestimate accuracy rates in Baltimore have dropped since my last post in 2013 about the subject, Towson Zillow Zestimates Incorrect and Problematic. (In that post I have links to five other actual issues I have dealt with over the years when it comes to Zillow Zestimates!)
To understand a true value of a Baltimore home, please contact a real estate professional who can do an in depth market analysis of the home and area, taking into account the condition of the home, and its’ location within a community.