How much weight should home owners put on a "Zestimate"?

Do you have prospective sellers always referring to Zillow's Zestimate to accurately price their home?
  • February 10 2014 - Los Angeles
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Answers (9)

They are all over the board.  There is not shortcut to spending the time to do an actual CMA based on recent sales of comparables and KNOWING your market. 

You should be selling your expertise and services to potential clients. Even if they are ready to list, they should be encouraged to call you with all questions regarding the housing market in your area.  If you keep them coming back to you with questions you build trust and will likely earn their business when the time is right for them to sell and/or purchase.  

  • February 14 2014
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To answer your question yes, I frequently have sellers/buyers reference Zestimates. Sometimes they are high and sometimes they are low.

How much weight should be put on a Zestimate? The two following links are a good resource on the matter as they talk about items that aren't covered in the algorithm, as well as Zestimate accuracy in various markets. Both are good to share as some sellers may not be aware of them. Have a great day!
 
http://www.zillow.com/wikipages/What-is-a-Zestimate/ 

http://www.zillow.com/howto/DataCoverageZestimateAccuracy.htm
  • February 12 2014
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2 pounds
  • February 11 2014
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Profile picture for Blue Nile
"Zestimates are as good as an algorithm can be" -

That is a complete outright "lie".  That is like saying cars can't drive themselves, yet Google has proved that wrong over the past 10 years.  Their present version of self-driving cars drive better than most U.S. citizens that have U.S. driving licenses.  And they are still working to resolve some of the possible glitches that could still potentially cause them to crash.

I know of at least 100 SPECIFIC changes that can be easily made to make the Zestimate algorithm better.  But it is "their" opinion, and they are entitled to their own methods, and if I want to do something different, isn't it up to me to make my own?  Sure, I occasionally share potential improvements with the team that developed and implemented the method, but really, Zillow has less than 10% market share of AVM's, and there are over a dozen other free AVM's, and thousands of other AVM's in use; so why are people so worried about only "1" method?

And I still think it extremely laughable that any Realtors would claim that only 1.2 MILLION Realtors have mastered the art of estimating sufficiently for each of them to INDIVIDUALLY do 26 BILLION estimates each year, defining what price ranges SHOULD be so that they can create another housing bubble, so that they can bankrupt over 12 million households, and can cause over 12 million foreclosures, as they did with the last housing bubble correction.

Over half of those 1.2 Million Realtors don't do any CMA's at all; they just run the computer estimating software provided by their local MLS using the MLS database, and then complain that the software they use is not an AVM.
  • February 11 2014
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Zestimates are as good as an algorithm can be. They do not consider supply and demand, neighborhood characteristics or home features.  A BPO, CMA or Appraisal should always be considered when listing a home.
  • February 11 2014
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Profile picture for pyc1930
I think Zestimates are way off.
How can I tell Zillow that I listed my FSBO with a Realtor and that the price was increased?
AR Dubel 843 705 7644
  • February 11 2014
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I'd say about the weight of a double ply piece of toilet paper would be about right.
  • February 11 2014
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Nobody has the exact answer to a home's value until a buyer is found who will pay for it.   Zestimates are Zillow estimates and are pretty wide ranging, high or low for a homes value.  Some are higher, some are lower.  The good thing is that they do help establish the range a home should normally drop into but even then there is an art that only an agent can use to define where the range actually is.
  • February 11 2014
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Profile picture for Blue Nile
No; can't say that I've heard of any sellers referencing a Zestimate...

But I've had lots of perspective Realtors that keep referencing the Zestimates in their CMA's.  And several Realtors that claimed their CMA was the "exact value"; and some Realtors that stated it is IMPOSSIBLE to use a calculator or computer to do a CMA.  And several that stated they don't do line adjustments on the comparables as that is too much work; that if one needs that, they need an appraisal.  And some that stated I really should get some other Realtors to do the CMA's instead.

And I've yet to see any Realtor publish a confidence interval or tolerance range with their CMA's.

I keep thinking it would be a good idea if we changed state law to make it MANDATORY to publish either a 70% confidence interval or a 90% confidence interval, or a Standard Deviation with ALL CMAs.  Either that, or make it mandatory for them to publish with the CMA "this estimate is only my personal opinion of approximate value, and is only based on 3 randomly chosen similar recently sold properties in the area, and has no mathematical nor statistical validity of any kind".

I'm also thinking it would be a good idea if they were required to publish with each CMA the number of lottery tickets they purchased in a 6 month time period, and the percentage of those purchased that were winning number combinations of $5 or more.
  • February 11 2014
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