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How can you call your change in Valuation an Improvement?

Mid May, my home was valued on Zillow at about $820,000.  I went on today and there was a valuation dated 6/15/11 of $954,000.  I moved around a bit and came back to the page with the valuation and, there was now a valuation dated 6/17/11 for around $720,000.  That's an improvement!!!  Up 130 then down 230 in the space of a month. I looked at the area map and there are two homes within 4 houses of mine that are significantly smaller, significantly older on similar plots and, guess what, they are valued 10% higher than mine.  They never were before.  I had a realtor look at our property in April.  He wanted to list the house at $1.2 to $1.3 MM.  He thought he might be able to get $1.4 MM but for a fast sale, we should go with the lower numbers.  Obviously, that is his opinion, but the inconsistency of Zillow's estimate on my property makes Zillow suspect.  It's inconsistency with nearby properties of lesser value posting at a higher price makes Zillow suspect.  You say we should use Zillow's estimate as only a guide.  Are we supposed to follow that guide when it jumps off a cliff?  We may know the estimate is $#^$ and know not to use it, but we are forced to rebut it if a home buyer wants to believe it.  This is supposed to be a tool for both sides for giving a fair value.  We live in the center of one of the biggest cities in the US where there are tons of home sales.  The database should be big enough here to give reliable output...not the %$#^$ it is giving.  
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June 20 2011 - Medical Center Area
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Profile picture for jaydarg
On top of this, Zillow values a smaller home by the same builder of similar age on a smaller lot within a few blocks of my home $270 k more than mine.
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June 21 2011
Profile picture for jaydarg
Thank you for your thoughts.
I actually refinanced the home last year and got an appraisal over $900,000.  I tend to think that was a little low to make sure the bank was covered. I was actually shocked at the realtor's number and take that with a large grain of salt but it does help to benchmark.

The absolute number is kind of irrelevant.
Zillow's values are inconsistent outside their claimed accuracy showing values for homes on the same block.  How does that happen?
Zillow says with their new algorithym that my home has lost 30% in value in 5 months and 25 % in two days (a 6/15 value vs. a 6/17 value).  How does that happen?

As a buyer, I would wave the low value in front of the seller's face.  And as a seller, I have to refute it, which I shouldn't have to do. 
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June 21 2011
Really no difference in that and hiring an appraiser only to find out its $200K less than you thought.....except its cheaper.

Problem is most people are not aware of their recent SALES  and ACTIVES/PENDINGS in their immediate area which dictate value. Bottom line no of us really want to believe values are as low as they are.....

Zillow and its algorithims can be wrong and/or disputed, but your value is what it is, and that will really only be found if and when you sell your home.

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June 21 2011
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My biggest concern is that, until you hire and pay an appraiser, you don't know your home's true value, so many people have used Zillow as a guideline to make their initial decision to sell, re-fi, get a home equity loan, etc.  Imagine their surprise when they suddenly find out that their home is worth $200K less than they thought, just because Zillow "improved" their algorithm?!?  Again, realizing that Zestimates are only a guideline, but that is a HUGE difference!
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June 21 2011
here is Zillows link to zestimates. I think you will find this very helpful
http://www.zillow.com/wikipages/What-is-a-Zestimate/
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June 21 2011
Profile picture for jaydarg
My biggest concern here is how bad the Zillow values are.  I know a realtor is going to be overly optimistic.  But recent comparable sales in the area are closer to his estimate than Zillows
There are three or four homes on my block that should be of lesser value (older, smaller, etc.) yet Zillow values them higher than mine with their new method.  The old method didn't.
Zillow's valuation will be used as a tool for starting negotiations by a buyer.  I mean I would too if it helped me.  Why do I have to refute an absurd valuation?
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June 21 2011

I understand your frustration. It is similar to the misconception on the appraisal district value that many people have. Property values are always obviously changing according to the market and recent sales. 
I would suggest you get a reputable appraiser out there at your cost as well as the right agent to market your home to sell. Let me know if you are ready for an appraiser contact and another market analysis.

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June 21 2011
 
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How can you call your change in Valuation an Improvement?
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June 21 2011 | 7 answers
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