Tucson Real Estate Blogs » Home Sellers, Buyers, and Realtors Beware of Zillow’s Zestimate

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Douglas Trudeau , Assoc. Broker
Prudential Foothills Real Estate
64 N. Harrison Road, Suite 160
Tucson , AZ 85748
Mobile: 520-954-2209
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Home Sellers, Buyers, and Realtors Beware of Zillow’s Zestimate

Zillow seemed like a good thing for Realtors in the Tucson Real Estate market. Allowing Realtors to assist Sellers in getting their home before more Buyers when Zillow announced Q&A. Being reasonable, I thought I would give Zillow a try. Maybe things had gotten better. I ran one home for a while to test it. No Zestimate came back on it. It seemed like a good forum to get offer one more service for my clients. So, today I entered another home. Boy was the Zestimate off.

My partner and I ran independent comparisons and came up with similar information. Three other Realtors who competed for the listing came up with…

similar numbers that the Seller showed us. When I loaded the information in Zillow today, the Zestimate came back $20,000 below what experienced Realtors had provided.

I ran Zillow a few years back, with similar results. I guess things haven’t changed much. As Realtors we try to get our Seller’s home out to as many locations as possible to increase buyer recognition. Sometimes that can be dangerous if put on the wrong venue. I read an article by Gena concerning Zillow, Zestimate…Yes or No? and felt like my brain had been picked. What I was feeling is what she was saying.

The article from Gena referenced another by Christine Forgione, Mr. Seller, drove the point home. Should I pull my second posting with Zillow? Should I leave it? I needed more information.

Here came the research. In my own state of Arizona, Zillow was given a cease and desist order. Hmmm, need more information. I read a variety of articles about the order. Greg Swann in his BloodhoundBlog said it best. Jeff Kempe, from Lake Oswego, Oregon took it one step further in his article Free The Market! Free The Market!

Ultimately, its the Realtor who should go beyond the MLS to get estimates and be prepared. Like it was drilled into me, Proper Prior Planning Prevents Poor Performance. Getting a Zestimate cannot possibly take all factors into consideration. It will help prepare Realtors for objections that Sellers or Buyers may have. This is a great opportunity for showing your expertise and worth to your client.

For Buyers and Sellers, know that the Zestimate is an objective estimate, not a subjective appraisal. An objective estimate takes basic information and formulates it into an opinion without consideration of other related input or information. A subjective appraisal take numerous factors into consideration for a determination specific to the property that is being evaluated. So did I remove the listing from Zillow? My fiduciary responsibility is with the seller to get the best possible price. What do you think I did?

This entry was posted on Wednesday, April 25th, 2007 at 9:16 pm and is filed under Real Estate News. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.

Hi Doug, it’s David from Zillow,

You seem to have a good understanding of how Zestimates work — it is not an exact science. Zillow has not visited the house, and we’re not privy to all of the nuances of the local market conditions. A Zestimate value is a starting point for researching the value of homes and affordability of neighborhoods but it does not replace a CMA or appraisal.

So, with that great understanding of how AVM’s work, I must admit that I’m confused about why you’d remove a listing from Zillow?

Consumers get it - and they also come to Zillow for more than just Zestimate values. More than 4 million people visit the site each month and your clients’ house and it’s Zestimate value are going to be viewed regardless of whether or not you posted the listing on Zillow. So, why wouldn’t you take the opportunity to set the record straight? Why would you rather choose to have the incorrect Zestimate be the only information they find about the house? That seems like bad advice.

Once a home is posted for sale on Zillow, the “for sale” price takes the Zestimates place as the most prominent information about the home. Unlike other free-to-consumer AVM’s, Zillow allows owners and agents to publish corrections to the public facts about the house. In most cases, an incorrect Zestimate is the result of incorrect or incomplete public records. If you use the site to point that out to prospective buyers, you could generate more, not less interest in your listing.

Nielsen ranked Zillow the 2nd most visited online real estate site in February. As you know, 80% of buyers start their search online. Considering it costs nothing to post listings to Zillow, surely it makes sense to do so - especially when you anticipate discussions about an inaccurate Zestimate.

April 27th, 2007 // David G from Zillow.com