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Is there any credence to the claim that Zillow's "zestimates" are frequently inaccurate? If not, then I don't see any legitimacy behind this movement. Edit: I

Is there any credence to the claim that Zillow's "zestimates" are frequently inaccurate? If not, then I don't see any legitimacy behind this movement. Edit: I ask because the populist-y invective on this site raises red flags for me, but I also don't know anything about this industry.

bognition 9y ago
Its not zillow that is buying your house but zillow is acting as a broker to connect you to investors who are making offers. So i'm not sure how the accuracy of zestimates comes into play here.
- paulie_a 9y ago
  Unless something has drastically changed, everything you said is completely incorrect. They sell ads to agents.
abhv 9y ago
Yes. I sold my house without a broker in Oct 2016. The zestimate for the house was 640k at the time I listed on MLS. This was a stupid estimate based on comparable properties on the same block. I sold my house for 750k. Today, months after the sale was recorded, the zestimate shows 657k. I think buyers in competitive markets who rely on zillow will lose several times before they learn the market. I think sellers in competitive markets can just ignore it. That said, I have never had good experiences with real estate agents. I didn't use one to sell 2 properties, and I havent used one when buying either (instead, asking to split 3% commission).
Spooky23 9y ago
It varies a lot in quality. In the case of my own home, which is an urban home on a block with different housing types, it varies 6-7% from one month to another, over relies on tax assessment data, and doesn't understand neighborhoods. Even a cheap paid tool will generate a better value estimate. It's pretty good in subdivisions. Then again, anyone can figure that out. "Instant offers" is the online equivalent of those "we buy houses" signs that you see in some areas. It's a borderline predatory practice and makes you question the real reasoning behind doing it. They probably built it for some real estate state investment pool that bought up distressed property during the recession.
- r00fus 9y ago
  What about the problem where Zillow is sometimes itself used as a source for AVM [1]? [1]https://en.wikipedia.org/wiki/Automated_valuation_model https://en.wikipedia.org/wiki/Automated_valuation_model
  - Spooky23 9y ago
    That seems incredibly lazy to me! I didn't see what the package was, but when I recently refinanced, the bank used software that understood neighborhood overlays and could find comps on similar properties. It also listed similar but excluded comps and the reason why. (Ie bigger/smaller yard, garage, dead end, proximity to 4+ family, etc) The only input required was a questionnaire from a drive-by condition evaluation. That appraisal was within a $5k error bar compared to informal assessments that I had done independently with 3 real estate people.

bognition 9y ago

Its not zillow that is buying your house but zillow is acting as a broker to connect you to investors who are making offers. So i'm not sure how the accuracy of zestimates comes into play here.

paulie_a 9y ago
Unless something has drastically changed, everything you said is completely incorrect. They sell ads to agents.

abhv 9y ago

Yes. I sold my house without a broker in Oct 2016. The zestimate for the house was 640k at the time I listed on MLS. This was a stupid estimate based on comparable properties on the same block. I sold my house for 750k. Today, months after the sale was recorded, the zestimate shows 657k. I think buyers in competitive markets who rely on zillow will lose several times before they learn the market. I think sellers in competitive markets can just ignore it. That said, I have never had good experiences with real estate agents. I didn't use one to sell 2 properties, and I havent used one when buying either (instead, asking to split 3% commission).

Spooky23 9y ago

It varies a lot in quality. In the case of my own home, which is an urban home on a block with different housing types, it varies 6-7% from one month to another, over relies on tax assessment data, and doesn't understand neighborhoods. Even a cheap paid tool will generate a better value estimate. It's pretty good in subdivisions. Then again, anyone can figure that out. "Instant offers" is the online equivalent of those "we buy houses" signs that you see in some areas. It's a borderline predatory practice and makes you question the real reasoning behind doing it. They probably built it for some real estate state investment pool that bought up distressed property during the recession.

r00fus 9y ago
What about the problem where Zillow is sometimes itself used as a source for AVM [1]? [1]https://en.wikipedia.org/wiki/Automated_valuation_model https://en.wikipedia.org/wiki/Automated_valuation_model
- Spooky23 9y ago
  That seems incredibly lazy to me! I didn't see what the package was, but when I recently refinanced, the bank used software that understood neighborhood overlays and could find comps on similar properties. It also listed similar but excluded comps and the reason why. (Ie bigger/smaller yard, garage, dead end, proximity to 4+ family, etc) The only input required was a questionnaire from a drive-by condition evaluation. That appraisal was within a $5k error bar compared to informal assessments that I had done independently with 3 real estate people.