3 ms·

>Don't be too sure about that 10% increase in value. Not disagreeing, but zillow and redfin both track their estimate accuracy: https://www.redfin.com/redfin-e

by jotux 3y ago

>Don't be too sure about that 10% increase in value. Not disagreeing, but zillow and redfin both track their estimate accuracy: https://www.redfin.com/redfin-estimate https://www.redfin.com/redfin-estimate https://www.zillow.com/z/zestimate/ https://www.zillow.com/z/zestimate/

Aurornis 3y ago
I've always found these accuracy claims fascinating. They both claim <5% error in my metro area, yet when I'm house hunting it's rare for me to find listings where both sites agree within 5%. I always check both sites when I'm looking at houses (basically every day) and the pattern holds: They can't really agree within 5%. Technically they could both be correct if the sale price lands neatly between the two estimates, but some of these historical estimate graphs are also swinging more than 5% per month, too. I think there might be some fuzzy math going on somewhere.
lotsofpulp 3y ago
If Zillow was good enough at estimating home prices, they would not have shuttered their home buying/selling business after experiencing hundreds of millions in losses. https://www.nytimes.com/2021/11/02/business/zillow-q3-earnings-home-flipping-ibuying.html https://www.nytimes.com/2021/11/02/business/zillow-q3-earnin... >Zillow, facing big losses, quits flipping houses and will lay off a quarter of its staff. >The real estate website had been relying on its algorithm that estimates home values to buy and resell homes. That part of its business lost about $420 million in three months.
- DANmode 3y ago
  Bad take. Zillow is great at estimating home values and related figures. They're NOT great at estimating those values in the future.
  - lotsofpulp 3y ago
    That is a good point, but I have seen it play out over the years. When prices were going up, you can see the house price estimates lag as the most recently sold homes would sell for a higher price and all the other ones in the neighborhood take a while to update. This was late 2010s to 2022. Then once the prices started coming down, the opposite. I am looking at multiple homes right now, with multiple markdowns, and yet all the other homes around them have the same estimated Zillow price as many months ago, which the currently listed for homes obviously did not sell at. This is mid 2022 to now.
- philwelch 3y ago
  That wasn’t the problem. If Zillow undervalued or correctly valued your house you would never sell to them, and if Zillow overvalued your house you would always sell to them. The valuations could be extremely accurate overall and it would still be a terrible business plan because of adverse selection.
  - deleted 3y ago
    [deleted]
- plagiarist 3y ago
  They tracked their estimate accuracy all the way to the bank.

by jotux 3y ago

Aurornis 3y ago

I've always found these accuracy claims fascinating. They both claim <5% error in my metro area, yet when I'm house hunting it's rare for me to find listings where both sites agree within 5%. I always check both sites when I'm looking at houses (basically every day) and the pattern holds: They can't really agree within 5%. Technically they could both be correct if the sale price lands neatly between the two estimates, but some of these historical estimate graphs are also swinging more than 5% per month, too. I think there might be some fuzzy math going on somewhere.

lotsofpulp 3y ago

If Zillow was good enough at estimating home prices, they would not have shuttered their home buying/selling business after experiencing hundreds of millions in losses. https://www.nytimes.com/2021/11/02/business/zillow-q3-earnings-home-flipping-ibuying.html https://www.nytimes.com/2021/11/02/business/zillow-q3-earnin... >Zillow, facing big losses, quits flipping houses and will lay off a quarter of its staff. >The real estate website had been relying on its algorithm that estimates home values to buy and resell homes. That part of its business lost about $420 million in three months.

DANmode 3y ago
Bad take. Zillow is great at estimating home values and related figures. They're NOT great at estimating those values in the future.
- lotsofpulp 3y ago
  That is a good point, but I have seen it play out over the years. When prices were going up, you can see the house price estimates lag as the most recently sold homes would sell for a higher price and all the other ones in the neighborhood take a while to update. This was late 2010s to 2022. Then once the prices started coming down, the opposite. I am looking at multiple homes right now, with multiple markdowns, and yet all the other homes around them have the same estimated Zillow price as many months ago, which the currently listed for homes obviously did not sell at. This is mid 2022 to now.
philwelch 3y ago
That wasn’t the problem. If Zillow undervalued or correctly valued your house you would never sell to them, and if Zillow overvalued your house you would always sell to them. The valuations could be extremely accurate overall and it would still be a terrible business plan because of adverse selection.
- deleted 3y ago
  [deleted]
plagiarist 3y ago
They tracked their estimate accuracy all the way to the bank.