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How accurate is zillow with home valuations?


Recently I wanted to refinance my two loans  together, by zillow's appraisal I have more than enough to refinance, however I was working with a lender who had his appraiser run comparables in my area and the assessed value was much less, so much that I was unable to refinance. I know the best thing is for me to have an official appraisal; however I just want to know how zillow comes up with their figures as I believe they are much more reflective of the current value of my home and surrounding homes in the neighborhood. 
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May 14 2009 - Pinehurst
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Profile picture for sunnyview
Zillow does not provide an appraisal. They only provide a number based estimate. There is more here. The degree of accuracy on Zillow varies a lot from area to area. There are some numbers on that here.

As for changing appraisals, not so much under the new regs. You can challenge issues of accuracy, but cannot require the appraiser to use your agent chosen comps. During a loan process, appraisers do not work for you or for your agent. They work to protect the banks interests.
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December 09 2011
Real estate appraisers cannot go more than 6 months back with comparable home sales. They usually start with the nearest homes and equivalent square footage amount. Zillow gives you a rough idea of the home value but does not know the condition of the home, so values fluctuate greatly. Even appraiser really do not go out of their way to take into account granite countertops and stainless steel appliances. The use items such as sq footage, Lot size, Patios or additions, style of home  (ex. Cape Cod) and distance to previous sold homes. Manyt times two different appraiser can have very different values depending on the comparable homes they have choosen. Its best to ask your realtor for all recently sold homes in the area for the last six months and see which homes the appraiser is using for his value. You can then submit your findings and the bank may ask the appraiser to adjust the value based on your research or order different appraisal company. 
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December 09 2011

Recently I wanted to refinance my two loans together, by zillow's appraisal I have more than enough to refinance, however I was working with a lender who had his appraiser run comparables in my area and the assessed value was much less, so much that I was unable to refinance.

This is typical in depreciating markets. Apparisals usually are more accurate as they take into effecti listings and pending, and have no-site inspectionf of both the Subject property and comparables. But 'running comparables' is still NOT an apprasial, they need to come out and to the inspection of your home and type up the formal appraisal fo come up with a value.   .

Also from MY experience, Zillow OVER VALUES home values if anything, at least in my area (Southern California) which has plenty of data.... maybe on purpose to deflect criticisim (?!?!) or not anticipating further market losses.....

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December 09 2011
Profile picture for SanDesignsUSA
Asking a realtor to appraise your home is NOT a good idea, especially in this market. A realtor only wants to list homes he can sell EASILY and so he will ask you to list your home for less than what's it's worth, so it will sell quickly and put money in the realtor's pocket without much effort.  
Preying on people is distressful situations (such as loss of a job/income/divorce) makes it easy for a realtor to get people to list for much less than their home is worth.  You need to get an APPRAISER to assess your property's value as he/she is the only one who does not stand to gain (or lose) anything personally no matter what the value of your home is.
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December 09 2011
A zestimate is an estimate.  If you watch the video as pointed out by Sencer, it says "do not list your home or buy a home based on the zestimate value".  Furthermore, use it as a starting point in your research.

As Chris Jones mentioned above, the currently the real estate market is composed of a mixture of distressed properties and properties not-in-distress.  Unfortunately the relative large number of short-sales, foreclosures and bank owned properties are pulling prices downwards. A standard seller will have to compete in the market place with these distressed properties.  There is not separation of these two markets it is one big pool.

One important point is that not all distressed properties are fixer-uppers.  I have seen brand new homes in ready to move condition that are bank owned.(ie the builder went bankrupt).  These are the type of properties that erode home values in today's market but also bring great buying opportunities.

To get an accurate property value you may want an appraiser in case of a re-finance or get a real estate agent to run a price opinion if you are thinking of selling.  In either case, the distressed properties will be considered in the valuation analysis.





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May 15 2009
Kristin beat me to it... :)

Here's also a video which might be helpful.
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May 14 2009
Hi Soldierof101,

Our accuracy varies regionally and home by home. We publish detailed accuracy statistics to help explain how we think we're doing in differnt regions. But those are median numbers, not the specifics of a home and it's based on a computer model taking into account many factors.

The best way to get a reallly good valuation for your home that a bank will use for your refinancing would be to hire an appraiser to do the detailed work looking at your exact house. The Zillow Directory has a number of appraisers who serve Everett.

Good luck,
Kristin
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May 14 2009
That really depends on where you live.  I have had Zillow be within a few thousand of the appraised value many times - in fact, that was the norm up until a year or so ago - but recently, Zillow has been all over the map.  That's a reflection of the volatile market, and the fact that there really are two markets right now in real estate: the standard sales market, where your house is; and the short-sale/foreclosure market, which is where most of the sales are happening right now.

You can make the argument that a sale is a sale, and that the short-sale/foreclosure market represents the real market price of houses, but I think that's not true.  I think the true price is somewhere in the middle.  Unfortunately, until the mass of distressed sales starts to abate - not until 2010, I'm sad to say, at the earliest - you won't see prices stabilize.

It's hard for appraisers right now, especially with the new regulations.  You might try contacting a Realtor and asking him to do an analysis for you, see what he comes up with.  Unless you want to spend the money for a full appraisal, that's probably your best bet.
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May 14 2009
 
Related Questions
How accurate is zillow with home valuations?
Profile picture for sunnyview
Latest answer by sunnyview
December 09 2011 | 8 answers
  • Asked by soldierof101
  • In Refinance
  • May 14 2009
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