So Zillow has really become quite popular over the past several years and it’s the go to place for many potential buyers and sellers. But there is something that needs to be addressed and that is the Zestimate.
The Zestimate is NOT always accurate and we see many potential buyers walking away if they see the asking price at or above the Zestimate. The Zestimate does not mean that the home is not worth what is being asked. Additionally, we have potential sellers demanding that their home is worth what the Zestimate is saying, however, we’ve seen the value come in both higher and lower. So many factors play into the true value of a home. There is no algorithm that can truly identify the value of the home.
That’s why working with a professional real estate agent who knows your local market is always your best option and there will always be a true appraisal completed when you begin moving through the purchasing process.
So what is the Zestimate?
This is the explanation right from Zillows website: The Zestimate® home valuation model is Zillow’s estimate of a home’s market value. The Zestimate incorporates public and user-submitted data, taking into account home facts, location and market conditions.
It is not an appraisal and it should be used as a starting point. We encourage buyers, sellers and homeowners to supplement the Zestimate with other research such as visiting the home, getting a professional appraisal of the home, or requesting a comparative market analysis (CMA) from a real estate agent.
Zillow publishes Zestimate home valuations for 97.5 million homes across the country, and uses millions of statistical and machine learning models that can examine hundreds of data points for each individual home.
To calculate a Zestimate, Zillow uses a sophisticated and proprietary algorithm that incorporates data from county and tax assessor records and direct feeds from hundreds of multiple listing services and brokerages. The Zestimate also incorporates a home’s facts and features, which homeowners have the ability to update.
The Zestimate accounts for variables like:
- Home characteristics including square footage, location or the number of bathrooms
- Unique features like hardwood floors, granite countertops or a landscaped backyard
- On-market data such as listing price, description, comparable homes in the area and days on the market
- Off-market data — tax assessments, prior sales and other publicly available records
Currently, we have data for over 110 million U.S. homes and we calculate Zestimates for more than 97.5 million of them.
How accurate is the Zestimate?
The Zestimate’s accuracy depends on location and the availability of data in an area. Some areas have more detailed home information available — such as square footage and number of bedrooms or bathrooms — and other areas do not. The more data available, the more accurate the Zestimate value will be.
Can the Zestimate be updated?
Yes. The Zestimate’s accuracy depends on the amount of data we have for the home. Public records can be outdated or lag behind what homeowners and real estate agents know about a property, so it’s best to update your home facts and fix any incorrect or incomplete information — this will help make your Zestimate as accurate as possible.
You can also add info about the architectural style, roof type, heat source, building amenities and more. Remember: We can’t measure what we don’t know. Providing as much information as possible about your home will yield the most accurate Zestimate.
In some parts of the country, we may have basic information on some homes — but not enough information about enough homes to compute a Zestimate.
How can real estate professionals work with the Zestimate?
Millions of consumers visit Zillow every month. Most understand that the Zestimate is an estimate of the value of a home, and that it should be used as a starting point. When combined with the guidance of real estate professionals, the Zestimate can help consumers make more informed financial decisions about their homes.
We recommend that real estate agents and other professionals gain a basic understanding of how the Zestimate is calculated and how to read the Zestimate data accuracy table. This will help them explain to their clients why the Zestimate is a good starting point and historical reference, but should not be used for the final pricing of a home.
Real estate professionals can also help their clients claim their home on Zillow, update the home facts and account for any work they have done on the property. A home’s Zillow listing is often the first impression for prospective buyers, and accurate information helps attract interest.
So there you have it, right from Zillow.com. If you are interested in buying or selling, contact one of our professional REALTORS®.