Profile picture for user080500

Home Prices

How does a home valued in December of 2011 is valued at say 650,000 now be valued at 1.2m. Seems like a huge jump in price in two months. Can you elaborate how the zillow home price index is reflective of what an offer should be on a home. thanks
  • February 20 2012 - Carefree
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Answers (6)

Profile picture for nwhome.us
Ebbs and flows is good term for it.  It could be likened to the effect of the moon in the tides.
When a property hasn't been updated in value by its own recent sale, the value is influenced by sales that are deemed to be comparables by the computer.  Now those properties might also have been held in the same hands for decades (for an extreme example) and the actual sale may have dramatically updated that value.
Properties that are in niche markets (price range or location) and comparable sales actually vary widely in price, then individual Zestimates will ebb and flow dramatically.
The Zillow data is really much more useful on a neighborhood or zip-code basis. The data sets are larger and the results settle down a lot.  It's more useful to use the neighborhood trends and percentages to examine individual targets over time.  If something sold in 2003, and no updates were made, what has happened to the values in the neighborhood since then?  Apply that percentage of change to the sales price in 2003.
  • February 20 2012
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Profile picture for user080500
Well just really commenting on the Zill historical rating on the bottom. It ebbs and flows up and down, I see that the Nov. Zill historical number is at the low and in two months, now Feb. the price Zillow states the home is worth is twice the Nov. rate. Just curious. Thanks
  • February 20 2012
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Profile picture for nwhome.us
You just said that the property is "on the market."  That phrase means that it is listed For Sale.  Is it now listed for sale?
Are you asking why a Zestimate was very different than the Listing Price?
  • February 20 2012
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Profile picture for user080500
Thank you so much just wondering I am looking at a home that is on the market for 1.3m now and in Nov the Zillow algarithm was something like 850K., so I was wondering how that occurred; appreciate the infor
  • February 20 2012
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Profile picture for Cindy Quinton
Zillow is not meant to be used to know what to offer on a home. You can read more about zestimates here:
http://www.zillow.com/wikipages/What-is-a-Zestimate/

http://www.zillow.com/howto/DataCoverageZestimateAccuracy.htm
  • February 20 2012
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Zillow isn't a MLS and is not a licensed real estate broker.  The price "values" they post are an algorithm, and have nothing to do with real prices.  They scrape data from public websites like tax appraisers, and apply their "algorithm" to arrive at values.  Zillow says my real estate market is down 18% in 2011, but the real data shows it is flat.  Do not rely on Zillow data.  There is not one single municipality or mortgage lender that usese Zillow data for appraisals.
  • February 20 2012
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