WHAT IS MY HOUSE WORTH?
Monica recognizes that one of the first tasks that need to be completed when selling or buying a home is pricing the property. The Zestimate is a great starting point, although this does not consider all the market intricacies, many of which can determine the actual price a house will sell for. (Markets fluctuate from week to week and from neighborhood to neighborhood).
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HOW ACCURATE IS ZILLOW AND THE ZESTIMATE WHEN VALUING HOUSES?
The internet has revolutionized real estate over the last decade, and more than 90 percent of homebuyers begin their search there. An enormous amount of credit is due to Zillow, a company that has done a tremendous job in establishing its status by providing a high level of service to its customers.
To accurately value your home, you will require the input of a true professional — someone who knows how to value houses based on the location, condition, design features and other factors that dramatically influence the price
Zillow uses recently sold properties in given neighborhoods to determine pricing trends, which, in our opinion, is relatively accurate. This information can tell you if prices are going up or down in certain areas. In general. Zillow has a lot of great information, but you shouldn’t rely on it exclusively to give you an estimate for your property.
Zestimate uses a computer algorithm to generate a value. This is a very innovative form of technology, that uses sophisticated algorithms to predict value, and subsequently presents this information in an easy-to-use user interface. The reliability of this tool is, however, a little questionable. Research shows that, on average, “Zestimates” are within 5 percent of the actual value of a home about 50 percent of the time.
How do you know if their value is correct on your house or not?” Why can’t a computer accurately determine the value on a house?” Computer programs can determine the value on things like cars pretty accurately. Most cars are very similar and it is fairly easy to see what values may be using factors such as the year, the mileage and the repairs. However, for houses this formula is vastly different, because no two houses are the same and it is almost impossible for a computer program to accurately determine the value of a house.
No algorithm, however sophisticated, can quantify the value of a kitchen that was remodeled just before a home was put on the market, or a new roof, or a yard that is poorly maintained. It simply isn’t possible to predict the value of a home with a level of accuracy sufficient to make a housing decision.
Zillow spokespersons are fond of saying that Zestimates are not appraisals; rather, they are “a good starting point” or sometimes “just a starting point.” This is what Zillow states on his Zestimate page:
“Zestimates are intended as a useful starting point to help you determine an independent and unbiased assessment of what your home might be worth in today’s market. … your real estate agent or appraiser will physically inspect the home and take into account special features, location and market conditions.”