If you’ve spent any time on Zillow (and I know you probably have!) you have probably wondered how accurate those numbers actually are. It’s one of those things- when you want to sell, you really want that number high, but when you’re ready to buy, you want it to be low. Human nature, right? Well, it can’t be right all the time, and it’s often not wrong when we want it to be.
What all of us who actually work in real estate all day, every day would LIKE to say is, “Don’t pay any attention to Zillow.” Just don’t look at it. But we know that’s not going to happen. So, after it popping up in conversations with clients a few times in the past couple of weeks, in a few ways, I thought I’d break it down for you, FAQ style.
Q: Are the numbers right?
A: Well, that’s not a straight yes or no answer. Zillow, like many things, uses a complicated algorithm. This is based on recently sold homes (in Mls or not), tax records and assessments, and other bits of public info available. All of this information gets mashed up and that’s what creates the estimate. Tax records have the house listed as 5 bedrooms instead of 4? Public records didn’t update that you added a bathroom? Someone in the City or County make a mistake entering info? You get the idea. Bad info in, bad info out. (One of the MANY reasons you want to get a permit if you’re added baths, bedrooms, etc.)
Q: Well, where do they get their information?
A: As I mentioned above, that info is compiled from sales data, public records, etc, on around 100 million homes in the US.
Q: What if my info is wrong? Can I correct it so my Zestimate is accurate?
A: Well, kind of. You can, in fact, correct it. It is not usually quick, nor easy. You do have to reach out to them directly, and it may take some follow up. Even if you correct it, though, the correction may not change your Zestimate. If you put in a new basement bathroom, but that doesn’t add a lot of value in your neighborhood or area, you’re not going to see a real bump in the Zestimate.
Q: My house is the nicest house in the neighborhood, my lot is twice as large, and I have so much more square feet! Why is the Zestimate only $5000 more than my neighbor’s?
A: Well, Zillow can only work with the data it has, and the more data, generally, the more accurate the information is. If you have a neighborhood with many similar homes, that sell fairly regularly, your Zestimate will likely be somewhat accurate. If you have a great house in a rural area that doesn’t have a lot of turnover? Well, that will not be so accurate.
A few other thoughts and things to note.
There is no substitute for a realtor, with experience and knowledge of your area, to give you an accurate valuation of your home. Zillow has no real way of knowing if your home (or the one you are looking at) has 2000 square feet of shag carpet, or 2000 square feet of the highest quality hardwoods. They even disclose that their average Zestimate can be up to 10% inaccurate on average.
While it’s a great tool to get started, and it’s certainly user friendly, you can’t been hands on accuracy. (Don’t get me started on the listings it regurgitates every so often that have already sold and closed!)
If you have questions about Zillow, or what I do, please reach out and let me know. If you’re just toying with the idea of buying or selling a home, message or call me. I’d love to talk, and it costs nothing to have a conversation and get a good valuation!