When Zillow first hit the internet last year, he was intrigued. Wells Fargo Bank had previously offered a similar tool on its website, but it was no longer available. When I reviewed Zillow, I was not surprised to find that, like the banking tool, the numbers were only accurate in areas where the houses were similar in age, layout, and lot size. If you live in an eclectic neighborhood with radically different home styles, near a lake or in the country, the value could be in the thousands. So when I reviewed it, I took the information with a grain of salt. After all, the value of my own home, as it is located in the country, was based on its sale price 10 years ago and its current tax value.
Evidently, the Wall Street Journal Real Estate Journal had some of the same observations that I had with Zillow. They recently analyzed 1,000 recent home sales transactions in seven different states and compared them to their “Zillow Zestimates.” According to the article, “Zillow was within 5% of the price in a third of the transactions studied by The Journal. It was more than 25% off the target in 11% of them. In 34 of the 1,000 transactions, Zillow was more than 50%. “There was an overall average difference between the actual sales price and Zillow’s estimate of 7.8%, which is very close to the margin of error Zillow estimates of 7.2%. Read the full article at http://www.realestatejournal.com/buysell/tactics/20070215-hagerty.html?refresh=on
For certain homes in certain areas, Zillow is a great tool. I recently visited the site and was amazed at how their service has expanded over the past year. Not only could someone find an estimate of the value of a house, but there is also a listing search. Buyers can search for homes that are currently listed, with both FSBO and Realtors. There are color photos, aerial views, street maps and values. As an agent, I will only list houses on Zillow that fit the criteria where an accurate “Zestimate” will appear. But it is a tool that I will use. My clients were impressed, as it was another way to attract buyers.
Zillow will not replace the knowledge and experience of an experienced real estate agent. But for quick values for similarly styled homes built in many city developments, it’s surprisingly accurate. With all the added features and information, Zillow can be a helpful tool in the right hands.
Copyright 2007 Teri Eckholm