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 692   next

100 Brownstone Drive -- 5 BR, 5.2 BA
Price: $2,750,000 (7435 sqft)
Subdivision: The Point
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Dom DeMatteo | MLS # 3259357 | Active
122 N Longfellow Lane -- 5 BR, 5.2 BA
Price: $2,275,000 (6639 sqft)
Subdivision: The Point
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Matt Rawlins | MLS # 3319599 | Active
18010 Harbor Light Boulevard -- 4 BR, 4.2 BA
Price: $2,125,000 (5510 sqft)
Subdivision: The Peninsula
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Stephanie Landman | MLS # 3202607 | Active
8921 Linden Grove Court -- 4 BR, 5.3 BA
Price: $1,375,000 (5860 sqft)
Subdivision: Northview Harbour
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Michael Cloninger | MLS # 3339729 | Active
18516 Balmore Pines Lane -- 5 BR, 4.1 BA
Price: $1,363,000 (6486 sqft)
Subdivision: The Peninsula
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Mary Ann Calloway West | MLS # 3329308 | Active
5008 Slanting Bridge Road -- 4 BR, 4.1 BA
Price: $1,340,350 (4561 sqft)
Subdivision: Pearl Springs Village
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Julie Joseph | MLS # 3224226 | Active
108 Longfellow Lane -- 5 BR, 5.2 BA
Price: $1,220,000 (5633 sqft)
Subdivision: The Point
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Tricia Murphy | MLS # 3337116 | Active
156 Wades Way -- 4 BR, 3.2 BA
Price: $1,025,000 (4607 sqft)
Subdivision: Shady Grove
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Michael Toste | MLS # 3290417 | Active
7995 Holly Court -- 4 BR, 3.1 BA
Price: $950,000 (4127 sqft)
Subdivision: Westport Peninsula
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Camille Marshall | MLS # 3342439 | Active
165 Pin Oak Lane -- 5 BR, 3.1 BA
Price: $849,900 (4137 sqft)
Subdivision: Oak Harbor
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Geri Silliman | MLS # 3267721 | Active
147 Castle Drive -- 4 BR, 4.2 BA
Price: $825,000 (4681 sqft)
Subdivision: Indian Forest
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Colleen Hunt | MLS # 3259570 | Active
10 Kingfisher Court -- 4 BR, 3 BA
Price: $799,900 (3505 sqft)
Subdivision: Harbor Oaks
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Doug Bean | MLS # 3336018 | Active
108 Emerald Drive -- 5 BR, 3.1 BA
Price: $750,000 (3250 sqft)
Subdivision: Diamondhead
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Brigitte Perry | MLS # 3334356 | Active
223 Barber Loop -- 3 BR, 2.1 BA
Price: $745,000 (2016 sqft)
Subdivision: None
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Lucia Verville | MLS # 3298764 | Active
256 Harbor Watch Drive -- 4 BR, 3 BA
Price: $726,750 (3440 sqft)
Subdivision: Harbor Watch
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Angela Cook | MLS # 3226648 | Active
219 Castles Gate Drive -- 4 BR, 5 BA
Price: $689,000 (4935 sqft)
Subdivision: Morrison Cove
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Bruce Gasparre | MLS # 3339785 | Active
4699 Webbs Chapel Church Road -- 4 BR, 3.1 BA
Price: $654,900 (4686 sqft)
Subdivision: Ashley Cove
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Michael Toste | MLS # 3316988 | Active
104 Tuskarora Point Lane -- 4 BR, 3.2 BA
Price: $650,000 (3865 sqft)
Subdivision: Tuskarora Point
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Pauline Williams | MLS # 3312893 | Active
13711 Hagers Ferry Road -- 5 BR, 4 BA
Price: $599,000 (3880 sqft)
Subdivision: None
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Clarke Crawford | MLS # 3294865 | Active
2431 Talbot Court -- 5 BR, 4.1 BA
Price: $575,000 (3682 sqft)
Subdivision: Northview Harbour
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Tricia Murphy | MLS # 3323318 | Active

Listings 1 - 20 of 692   next

Lake Norman Waterfront Condos for Sale

Lake Norman condos

Listings 1 - 20 of 27   next

113 Clarendon Street -- 3 BR, 2.1 BA
Price: $275,000 (1951 sqft)
Complex: The Cove
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Kerry Tim Mills | MLS # 3337384 | Active
107 Pier 33 Drive -- 3 BR, 2.1 BA
Price: $274,900 (1313 sqft)
Complex: Pier 33
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Angela Cook | MLS # 3336458 | Active
18816 Nautical Drive -- 3 BR, 2 BA
Price: $274,900 (1333 sqft)
Complex: Schooner Bay
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Debi Gallo | MLS # 3287515 | Active
115 Dellbrook Street -- 3 BR, 2.1 BA
Price: $255,000 (2024 sqft)
Complex: The Cove
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Tanya Orrell | MLS # 3289797 | Active
18730 Ramsey Cove Avenue -- 3 BR, 2.1 BA
Price: $229,000 (1509 sqft)
Complex: Harborside
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Carole Dry | MLS # 3341419 | Active
107 N Cove Key Lane -- 3 BR, 3.1 BA
Price: $950,000 (3819 sqft)
Complex: Cove Key
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EXP REALTY LLC | MLS # 3331820 | Active
18541 Vineyard Point Lane -- 2 BR, 2.1 BA
Price: $550,000 (1784 sqft)
Complex: Vineyard Point
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Angela Anderson Real | MLS # 3339241 | Active
18015 Kings Point Drive -- 3 BR, 2 BA
Price: $465,000 (1482 sqft)
Complex: Baybridge
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EXP REALTY LLC | MLS # 3337948 | Active
20407 Harborgate Court -- 2 BR, 2 BA
Price: $457,390 (1790 sqft)
Complex: Harborgate
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Choquette Properties | MLS # 3342444 | Active
8234 Parknoll Drive -- 3 BR, 3 BA
Price: $452,522 (2941 sqft)
Complex: The Courtyards of Huntersville
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Plowman Properties LLC | MLS # 3124900 | Active
527 Catspaw Road -- 3 BR, 3.1 BA
Price: $429,000 (2211 sqft)
Complex: Catspaw
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Ivester Jackson | MLS # 3332450 | Active
18724 Nautical Drive -- 3 BR, 2.1 BA
Price: $399,900 (1735 sqft)
Complex: Commodores Landing
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BHHS Hickory Metro | MLS # 3334453 | Active
7905 Parknoll Drive -- 2 BR, 2 BA
Price: $375,790 (2034 sqft)
Complex: The Courtyards of Huntersville
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Plowman Properties LLC | MLS # 3139558 | Active
103 Pier 33 Drive -- 3 BR, 3 BA
Price: $349,900 (1633 sqft)
Complex: Pier 33
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Property Matters | MLS # 3325082 | Active
17811 Half Moon Lane -- 2 BR, 2 BA
Price: $345,000 (1179 sqft)
Complex: Kings Point
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RE/MAX Executive | MLS # 3342438 | Active
118 Town Center Drive -- 1 BR, 2.1 BA
Price: $299,900 (1544 sqft)
Complex: Meeting Street Townhomes
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Equity Commercial | MLS # 3333859 | Active
7619 Mariner Cove Drive -- 3 BR, 3 BA
Price: $245,000 (1919 sqft)
Complex: Mariner Villas
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Shearer Realty Inc. | MLS # 3331299 | Active
8248 Viewpoint Lane -- 3 BR, 2.1 BA
Price: $234,000 (1937 sqft)
Complex: Harborside
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Allen Tate Lake Norman | MLS # 3326498 | Active
2521 Gallery Drive -- 3 BR, 2.1 BA
Price: $221,900 (1589 sqft)
Complex: Westport Lakeside
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ElleBee Realty and | MLS # 3282231 | Active
2501 Shanklin Lane -- 2 BR, 2.1 BA
Price: $220,000 (1378 sqft)
Complex: Westport Lakeside
→ More info
ElleBee Realty and | MLS # 3326516 | Active

Listings 1 - 20 of 27   next