Can You Trust a Zestimate?

Austin Real Estate Podcast with Rosie Hayer

When you go online to Zillow, you’re able to get something called a Zestimate, which tells you the value of your home. The question is, can you trust those Zestimates to be accurate? Unfortunately, no. Most of the time, Zestimates are very inaccurate. According to Zillow’s website, a Zestimate is a starting point in determining a home’s value. It is not an appraisal. The Zestimate is actually based on public- and user-submitted date. The public data is usually fairly accurate, as it includes information about the square footage of your home. The problem is that Zestimates rely on user-submitted data. If you’re a homeowner looking to sell their house, wouldn’t it benefit you to go to Zillow and add some home improvements to your property? People often begin their home searches online on sites like Zillow. There are some agents out there who actually help people increase their Zestimates to make it seem like their home is worth more than it is. Zestimates can be tweaked and manipulated. Now, Zillow also goes on to say that they encourage homeowners to supplement the Zestimate by speaking with a real estate agent and getting a comparative market analysis or by getting an appraiser to visit the house. After all, Zillow has never been to your house and that Zestimate has no idea how your home stacks up against other homes in the area. “Why would you trust the value of your house to be determined by some website?” If you live in a major metropolitan area where there are a lot of homes for Zillow to pull from, your Zestimate might be more accurate. But if you live in a rural area without a lot of data or you live somewhere with a lot of unique homes, then that Zestimate can be a long way off. Zillow even admits that more than three-quarters of the homes in certain counties have Zestimates that are off by 10% or more. That means if your house is worth $700,000, your Zestimate is off by at least $70,000. Whether it’s too high or too low, it’s not good either way. Ultimately, Zillow is kind of like WebMD. If you’re curious about your health, you can go look up your symptoms on the website, but do you want the website to diagnose you? I’m sure you won’t. Think about it: Why would you trust the value of your house to be determined by some website? In today’s market, you need to contact a professional who’s actively looking and comparing properties in the marketplace. In fact, I invite you to look up your Zestimate online and send it to me. I will compare your property to recently sold homes in the neighborhood and then we can see how accurate your Zestimate really is. If you have any questions about Zestimates or home valuation, please feel free to reach out to me. I look forward to hearing from you.