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what are zestimates? are they good in making an offer on a home?

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January 10 2011 - Cedar Hill
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In some areas zestimates are fairly close. One person said it was within 3% of the sales price. In other areas they are very far off.

A zestimate is supposed to be accurate plus or minus 20%. That means if a house is valued at $200k it could be anywhere between $160k and $240k if the zestimate hits its desired range. Sometimes it could be off more than 20%.

Having said that many will tell you NO they are not good for using to make on offer. They are to far off to be of any use. Others would say use them. It is a negotiating tactic that just might work.

There was even one person who sold a house. When an offer came in for their old house based on a zestimate they told the buyer the zestimate was worthless and rejected it completely. THEN when they went to buy a house guess what they used to support an offer? You got it, that same zestimate.
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January 10 2011
In Kentucky- the Zestimates seem to be pretty far off- I've seen a few off by quite a lot-  your agent can show you all the "solds" in the area you are looking that are similar to the property you are interested in-  these will give you a better idea of the true selling/buying value in your market.  Good Luck!
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January 11 2011

A Zestimateis an estimate of a home value that  is based on similiar homes in close proximty to each other that Zillow uses to give you an zestimate on a property.

The zestimate is more accurate in new developments that have limited floor plans, similiar lot size and age. As neighoborhoods age certain homeowners will do upgrades to their home and increase the value, maybe add a pool, a second unit etc.
Zillow does not take into consideration a school district, if it backs to a freeway, power lines running over the property.  If you want to get an idea of the values in the neighorhood a zestimate may work fine. When making on offer or selling your home always use a knowledge Realtor who is familiar with the neighborhood to get a true analysis of the home.



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January 11 2011

For other parts of the country, the zestimates can be pretty close to the market value, however, they are not for Texas.  We have a non disclosure state which means that the sales prices are not made public only loan amounts are.  Since Zillow uses public records to compute the Zestimate, it skews the numbers and the zestimate is worthless for us.

Have your buyer's agent do a market analysis to look at recent sales of comparable homes in the neighborhood you are considering.

Naima

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January 11 2011
I've found zestimates to be somewhat accurate and definitely closer to fair market value then several years ago. With that said other times zestimates give consumers huge windows and vague pricing. Because its working with assessments or sold stats for comparables and does not know property condition, neighborhood, areas, school system reports etc. My advice call in a local realtor to preview the home and give you a current market analysis to determine the price. Good luck.
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January 11 2011
Nugamma,

ZEstimates are Zillow's estimates of a house's value.  There is no rule that says that you cannot base your offer on a ZEstimate.  However, a good agent should be able to give you an accurate Comparative Market Analysis for the home that you want; He should also provide strategies and advice on negotiating.

Your Real Estate Geek,

 Rich
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January 11 2011
Zestimates are very interesting.  I have found here in North Texas the Zestimate is typically not a good standard for true market value.  It is interesting that someone said when they went to make an offer they used the Zestimate to support their offer.  Of course, as a buyer's agent and it was in my clients favor, I would do the same thing. But, remember the MLS is still one of the best ways to assist in establishing value......it goes back to actual sales--that is what assists in establishing fair market value.  Use all your resources including your Realtor.

Much success in finding a Great home!
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January 11 2011
NO! These are computer generated values based on a formula which is the ssame though the country. I think the properties in Florida and California may differ in the approach.

If you look at Zillows own websit find the accuracy in your
area.http://www.zillow.com/howto/DataCoverageZestimateAccuracy.htm

Thanks
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January 11 2011
A zestimate is a estimate of value based on widely available data.  It does not take into account very recent sales, condition of homes or improvements. 

Recent closed comparable homes are good for basing an offer on a home.  Zestimates are good for making people crazy about the value of their homes.
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January 11 2011
 
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