Blog, How Much is My Home Worth?

The Trouble with Zillow Estimates

Where would you mostly likely look to determine the value of your home  if you were thinking about adding your home to the multiple listing service’s data base of homes for sale in MA? Most likely Zillow.com would be your first website of choice.

One of the critical services Realtors provide to their seller and buyer clients is a very detailed and well thought through comparative pricing analysis of homes to be marketed, for sellers, or homes to be purchased, for buyers.  In a CMA, comparative market analysis, a home is compared to other homes on the market in terms of such features as acreage, number of fireplaces, location, upgrades, newness of the kitchen, bathrooms, roof, general condition of the property, neutrality of colors and decorating style, quality of materials, size of the home, and “curb appeal”. These are only a few of the  important things that factor into the pricing equation.

I was curious about how Zillow would estimate home values in Concord MA or home values in Sudbury MA for instance.  On what criteria is the estimate based? I investigated and I surmise it is based on Tax assessment values which are usually much lower than fair market value, thankfully.

How does a Zillow estimate compare to an accurate and detailed comparative market analysis done by a Realtor?  A comparative market analysis determines the value of the subject home as it compares to other homes not only based on all the factors listed above but also on the value of similar homes that have recently sold, homes that are currently under agreement, homes currently for sale, and even those that haven’t sold.  These values can change suddenly, even from week to week or month to month. It is good to have a market analysis that is up-to-date, which I can’t say about a Zillow estimate.

Then I scrolled down to the bottom of the Zillow home page and found an obscure link in very, tiny print entitled “Zestimate Values and Accuracy.”  Hmmm.

That link took me to a chart.  If you click on this link I have pasted you’ll see a screen shot of  “Zillow Zestimate Values and Accuracy.”

http://www.screencast.com/users/cherylflynn/folders/Jing/media/a2d79618-72c1-492b-a752-9c1a62ee66d2

The line item for Boston on the chart illustrates that 66% of the properties on Zillow are only within 20% of the most likely selling price…..20% !  On a $500,000.00 home, that means you might as well be throwing darts onto the grand dartboard because you could be off by $100,000 up or down in value.

Moral of the story?  Call a Realtor if you are thinking of adding your home to the data base of  homes for sale in MA, or want to know about home values in Concord MA or home values in Sudbury MA.  Have a comparative market analysis done by a professional. They are always free and you will be able to sleep peacefully knowing the accurate fair market value of your home if you had to sell it today.