Zestimates-Wrong-Inaccurate

Zestimates – Why They are Not Helpful

Why a Home Buyer should never use them

What is a Zestimate?

Zestimate

(Pronounced ZEST-ti-met) – Information is straight from the Zillow Website

The Zestimate® home value is Zillow’s estimated market value for an individual home and is calculated for about 100 million homes nationwide. It is a starting point in determining a home’s value and is not an official appraisal. The Zestimates are automatically computed daily based on millions of public and user-submitted data points.

Zestimates® home valuation is Zillow’s estimated market value, computed using a proprietary formula. It is not an appraisal. It is a starting point in determining a home’s value. The Zestimate is calculated from public and user-submitted data, taking into account special features, location, and market conditions. We encourage buyers, sellers, and homeowners to supplement Zillow’s information by doing other research such as:

  • Getting a comparative market analysis (CMA) from a real estate agent
  • Getting an appraisal from a professional appraiser
  • Visiting the house (whenever possible)

Zillow also produces a Zestimate forecast, which is Zillow’s prediction of a home’s Zestimate one year from now, based on current home and market information. Learn more about the Zestimate forecast.

*For more information on Zestimates directly from Zillow, Click HERE

From: the Los Angeles Times
By: Kenneth R. Harney
Date: February 2015

When “CBS This Morning” co-host Norah O’Donnell asked the chief executive of Zillow recently about the accuracy of the website’s automated property value estimates — known as Zestimates — she touched on one of the most sensitive perception gaps in American real estate.

Zillow is the most popular online real estate information site, with 73 million unique visitors in December. Along with active listings of properties for sale, it also provides information on houses that are not on the market. You can enter the address or general location in a database of millions of homes and probably pull up key information — square footage, lot size, number of bedrooms and baths, photos, taxes — plus a Zestimate.

Shoppers, Sellers and Home Buyers routinely quote Zestimates to realty agents — and to one another — as gauges of market value. If a house for sale has a Zestimate of $350,000, a buyer might challenge the sellers’ list price of $425,000. Or a seller might demand to know from potential listing brokers why they say a property should sell for just $595,000 when Zillow has it at $685,000.

Disparities like these are daily occurrences and, in the words of one realty agent who posted on the industry blog ActiveRain, they are “the bane of my existence.” Consumers often take Zestimates “as gospel,” said Tim Freund, an agent with Dilbeck Real Estate in Westlake Village. If either the buyer or the seller won’t budge off Zillow’s estimated value, he told me, “that will kill a deal.”

Back to the question posed by O’Donnell: Are Zestimates accurate? And if they’re off the mark, how far off? Zillow CEO Spencer Rascoff answered that they’re “a good starting point” but that nationwide Zestimates have a “median error rate” of about 8%.

Whoa. That sounds high. On a $500,000 house, that would be a $40,000 disparity — a lot of money on the table — and could create problems. But here’s something Rascoff was not asked about: Localized median error rates on Zestimates sometimes far exceed the national median, which raises the odds that sellers and buyers will have conflicts over pricing. Though it’s not prominently featured on the website, at the bottom of Zillow’s home page in small type is the word “Zestimates.” This section provides helpful background information along with valuation error rates by state and county — some of which are stunners.

For example, in New York County — Manhattan — the median valuation error rate is 19.9%. In Brooklyn, it’s 12.9%. In Somerset County, Md., the rate is an astounding 42%. In some rural counties in California, error rates range as high as 26%. In San Francisco it’s 11.6%. With a median home value of $1,000,800 in San Francisco, according to Zillow estimates as of December, a median error rate at this level translates into a price disparity of $116,093.

Some real estate agents have done their own studies of accuracy levels of Zillow in their local markets.

Last July, Robert Earl, an agent with Choice Homes Team in the Charlottesville, Va., area, examined selling prices and Zestimates of all 21 homes sold that month in the nearby community of Lake Monticello. On 17 sales Zillow overestimated values, including two houses that sold for 61% below the Zestimate.

In Carlsbad, Calif., Jeff Dowler, an agent with Solutions Real Estate, did a similar analysis on sales in two ZIP Codes. He found that Zestimates came in below the selling price 70% of the time, with disparities ranging as high as $70,000. In 25% of the sales, Zestimates were higher than the contract price. In 95% of the cases, he said, “Zestimates were wrong. That does not inspire a lot of confidence, at least not for me.” In a second ZIP Code, Dowler found that 100% of Zestimates were inaccurate and that disparities were as large as $190,000.

So what do you do now that you’ve got the scoop on Zestimate accuracy? Most important, take Rascoff’s advice: Look at them as no more than starting points in pricing discussions with the real authorities on local real estate values — Experienced Agents and Appraisers.

Zestimates are hardly gospel — often far from it.

Call the Martin Real Estate Team of Lake Norman if you are interesting in Buying or Listing Your Home in the Cornelius, NC Real Estate area or other around Lake Norman…or even if you are looking for more information on Lake Norman Real Estate Values.

704-900-1619

Lake Norman Waterfront Homes for Sale

Lake Norman homes

Listings 1 - 20 of 889   next

100 Brownstone Drive -- 5 BR, 5.2 BA
Price: $2,750,000 (7435 sqft)
Subdivision: The Point
→ More info
Dom DeMatteo | MLS # 3259357 | Active
150 Heathland Lane -- 5 BR, 6.3 BA
Price: $2,295,000 (7613 sqft)
Subdivision: The Point
→ More info
Matt Rawlins | MLS # 3277902 | Active
125 Thurstons Way -- 4 BR, 4.2 BA
Price: $1,995,000 (4675 sqft)
Subdivision: The Point
→ More info
Matt Rawlins | MLS # 3254651 | Active
8025 Shore Drive -- 5 BR, 5.3 BA
Price: $1,550,000 (6501 sqft)
Subdivision: Lakeshore
→ More info
Linda Cantelmi | MLS # 3279461 | Active
5008 Slanting Bridge Road -- 4 BR, 4.1 BA
Price: $1,340,350 (4561 sqft)
Subdivision: Pearl Springs Village
→ More info
Julie Joseph | MLS # 3224226 | Active
153 Fox Hunt Drive -- 4 BR, 5.1 BA
Price: $1,125,000 (6543 sqft)
Subdivision: Beacon Pointe
→ More info
Michael Toste | MLS # 3306978 | Active
156 Wades Way -- 4 BR, 3.2 BA
Price: $1,050,000 (4607 sqft)
Subdivision: Shady Grove
→ More info
Michael Toste | MLS # 3290417 | Active
2343 Crofte Drive -- 4 BR, 4.1 BA
Price: $924,900 (5108 sqft)
Subdivision: Northview Harbour
→ More info
Michael Toste | MLS # 3290662 | Active
165 Pin Oak Lane -- 5 BR, 3.1 BA
Price: $870,000 (4137 sqft)
Subdivision: Oak Harbor
→ More info
Geri Silliman | MLS # 3267721 | Active
16108 Terry Lane -- 4 BR, 3.1 BA
Price: $850,000 (2508 sqft)
Subdivision: None
→ More info
John Rhodes | MLS # 3275752 | Active
128 Bunker Way -- 4 BR, 3.1 BA
Price: $849,900 (4770 sqft)
Subdivision: The Point
→ More info
Dom DeMatteo | MLS # 3279953 | Active
120 Kings Cross Lane -- 3 BR, 3.1 BA
Price: $840,000 (4663 sqft)
Subdivision: None
→ More info
Melissa McEachren | MLS # 3306296 | Active
147 Castle Drive -- 4 BR, 4.2 BA
Price: $829,000 (4681 sqft)
Subdivision: Indian Forest
→ More info
Colleen Hunt | MLS # 3259570 | Active
135 Ballston Drive -- 4 BR, 4.2 BA
Price: $825,000 (4389 sqft)
Subdivision: The Point
→ More info
Jeannie Coyer | MLS # 3287379 | Active
1224 Astoria Parkway -- 4 BR, 4.1 BA
Price: $799,900 (4681 sqft)
Subdivision: Astoria
→ More info
Michael Toste | MLS # 3293777 | Active
223 Barber Loop -- 3 BR, 2.1 BA
Price: $760,000 (2016 sqft)
Subdivision: None
→ More info
Lucia Verville | MLS # 3298764 | Active
108 Emerald Drive -- 5 BR, 3.1 BA
Price: $759,999 (3250 sqft)
Subdivision: Diamondhead
→ More info
Brigitte Perry | MLS # 3262320 | Active
9121 Azalea Road -- 3 BR, 2.1 BA
Price: $758,000 (3268 sqft)
Subdivision: None
→ More info
Michael Toste | MLS # 3301661 | Active
178 Beaten Path Road -- 3 BR, 3.1 BA
Price: $740,000 (3097 sqft)
Subdivision: None
→ More info
Debra Moss | MLS # 3253324 | Active
111 Sapphire Drive -- 3 BR, 3.1 BA
Price: $729,900 (3946 sqft)
Subdivision: Diamondhead
→ More info
Ryan Minges | MLS # 3257184 | Active

Listings 1 - 20 of 889   next

Lake Norman Waterfront Condos for Sale

Lake Norman condos

Listings 1 - 20 of 30   next

18708 Nautical Drive -- 3 BR, 3 BA
Price: $475,000 (1678 sqft)
Complex: COMMODORES LANDING
→ More info
Harbor Realty, Inc | MLS # 3303266 | Active
8234 Parknoll Drive -- 3 BR, 3 BA
Price: $454,512 (2941 sqft)
Complex: The Courtyards of Huntersville
→ More info
Plowman Properties LLC | MLS # 3124900 | Active
18724 Nautical Drive -- 4 BR, 3 BA
Price: $450,000 (1676 sqft)
Complex: COMMODORES LANDING
→ More info
Harbor Realty, Inc | MLS # 3301439 | Active
7921 Parknoll Drive -- 2 BR, 2 BA
Price: $438,885 (2100 sqft)
Complex: The Courtyards of Huntersville
→ More info
Plowman Properties LLC | MLS # 3124924 | Active
18525 Harborside Drive -- 3 BR, 2 BA
Price: $399,000 (1434 sqft)
Complex: Harborside
→ More info
Sellstate Select | MLS # 3293508 | Active
7905 Parknoll Drive -- 2 BR, 2 BA
Price: $375,790 (2034 sqft)
Complex: The Courtyards of Huntersville
→ More info
Plowman Properties LLC | MLS # 3139558 | Active
18631 Harborside Drive -- 3 BR, 2 BA
Price: $369,000 (1438 sqft)
Complex: Harborside
→ More info
Taft Realty & Auction | MLS # 3297319 | Active
110 Town Center Drive -- 3 BR, 2.2 BA
Price: $350,000 (2407 sqft)
Complex: Meeting Street Townhomes
→ More info
Keller Williams Lake | MLS # 3308243 | Active
637 Williamson Road -- 3 BR, 2 BA
Price: $345,000 (1541 sqft)
Complex: Harbor Point Village
→ More info
Keller Williams South | MLS # 3296970 | Active
18840 Nautical Drive -- 3 BR, 2 BA
Price: $329,000 (1332 sqft)
Complex: Schooner Bay
→ More info
Premier Sothebys | MLS # 3298472 | Active
105 Clarendon Street -- 3 BR, 2.1 BA
Price: $264,964 (1979 sqft)
Complex: Morrison Plantation
→ More info
Lake Norman Realty, | MLS # 3311605 | Active
17919 Kings Point Drive -- 2 BR, 2 BA
Price: $255,900 (952 sqft)
Complex: Kings Point
→ More info
Equity North Carolina | MLS # 3306194 | Active
18816 Nautical Drive -- 3 BR, 2 BA
Price: $254,900 (1350 sqft)
Complex: Schooner Bay
→ More info
Fathom Realty NC LLC | MLS # 3295664 | Active
2493 Shanklin Lane -- 3 BR, 3.1 BA
Price: $239,900 (1750 sqft)
Complex: Westport Lakeside
→ More info
ElleBee Realty and | MLS # 3312490 | Active
7533 Mariner Cove Drive -- 3 BR, 2.1 BA
Price: $239,000 (1719 sqft)
Complex: Mariner Villas
→ More info
Carolina Realty | MLS # 3311515 | Active
119 Capital Avenue -- 3 BR, 2.1 BA
Price: $233,900 (1966 sqft)
Complex: Morrison Plantation
→ More info
Keller Williams | MLS # 3283477 | Active
119 Capital Avenue -- 3 BR, 2.1 BA
Price: $233,900 (1966 sqft)
Complex: Morrison Plantation
→ More info
Keller Williams | MLS # 3283474 | Active
18009 Kings Point Drive -- 2 BR, 2 BA
Price: $229,000 (1009 sqft)
Complex: Baybridge
→ More info
RE/MAX Executive | MLS # 3297284 | Active
19435 Booth Bay Court -- 3 BR, 2.1 BA
Price: $228,900 (1590 sqft)
Complex: Villages at Harborside
→ More info
ProStead Realty | MLS # 3310322 | Active
119 Capital Avenue -- 3 BR, 2.1 BA
Price: $221,900 (1966 sqft)
Complex: Morrison Plantation
→ More info
Keller Williams | MLS # 3283479 | Active

Listings 1 - 20 of 30   next