Suppose you’re talking to your friends or significant other, and you wonder, “What’s my home worth?” If you have a great real estate agent, they’ve been sending you an equity update at least every year.
But who doesn’t want to know what Zillow has to say?
Maybe at some point you’ve gotten on Zillow only to feel as if your insides might come right out of your body because your home is valued at so much less than you thought.
Or the opposite could happen, as it did with Spencer Rascoff, the CEO of Zillow. Zillow estimated that Rascoff's home was worth more than double its actual sales price.
But does that mean Zillow is worthless as a homebuyer’s tool? Absolutely not. As with everything, it has both good and bad aspects:
THE BAD: As a company, Zillow looks at home values and what they sold for and averages those figures to give the site’s users a rough look at what they might expect for their own homes. Zillow Zestimates come from an algorithm of public online data. It lacks the human element of an agent, and therefore can’t anticipate a potential buyer or seller’s desires or account for any outliers.
"Does that mean Zillow is worthless as a homebuyer’s tool? Absolutely not."
The way to get an accurate evaluation of a home is not to get an appraisal. Consult with a real estate broker instead. Why is that?
First, an appraiser will be paid no matter what. Rarely will they receive any backlash from over- or underpricing homes, unlike real estate agents, who work directly with the seller.
Second, real estate agents use less data than Zillow but have a more accurate conclusion. But why? The specific quality of the data they’re selecting, if they’re an experienced professional, is going to be the most pertinent. To get an appropriate value for your home, you need to have someone physically walk through your home, and have a working knowledge of what is going on in the current market. Zillow can’t anticipate anything beyond its algorithms.
THE GOOD: Zillow does have verified third-party reviews on real estate agents. You should absolutely get on Zillow and look for agents with quality reviews from a reasonable number of people—anyone with about 25 to 100 five-star reviews (like me)—and call that person to see what they think your property is worth.
For a more in-depth look at this topic, check out the full article here.
Message, email, or call me if you have any questions or would like more information. I’ll be happy to talk to you.