There is no substitute for consulting a licensed real estate agent to get an accurate analysis of how much a home is worth in your market. However, many sellers and buyers are consulting a tool on Zillow.com to find out how much their home, or the home they want to buy, is worth. The tool is called a Zestimate®. Buyers and sellers seek out the Zestimate® for an instant appraisal or market analysis without questioning how the Zestimate® calculates that figure. To find out how accurate a Zestimate® is for your county, Zillow has another tool on their website which will tell you exactly how accurate their Zestimates® are.
Go to Zillow, scroll to the bottom of the page, click on the Zestimates® link. That link will take you to a page called “Data Coverage and Zestimate® Accuracy”. In the middle of the page is a box of data with stars. There are clickable links in the data box. Click on the link that says ‘States/Counties*’. Select your state then scroll to your county.
Screen shot taken by Adrienne Killey from Zillow.com_04/01/2013
I have selected Wisconsin and have scrolled down to Washington County (see picture above). Zillow feels that their Zestimate® accuracy for Washington County is 4 stars. Keep looking to the right to see exactly how accurate they are. For Washington County, a Zestimate® was only accurate within 5% of the actual sale price 44.4% of the time. So less than half of the time the Zestimate® was within 5% of the actual sale price (either within 5% above or within 5% below). Keep looking to the right and you’ll see that the Zestimate® was accurate within 20% of the actual sale price 87.3% of the time. Let’s think about that one using easy numbers. Let’s say a home sells for $100,000. The Zestimate® could have stated that the home is worth either up to 20% more than the actual sale price ($125,000) or no less than 20% below the actual sale price ($80,000) and they were right 87.3% of the time in that huge $45,000 swing. Whether you find that to be an impressive testament to the accuracy of the Zestimate® is up to you.
In defense of Zillow.com and their Zestimate®, Zillow is a nation-wide website that, as I have understood them over the years, is attempting to be a source for all on-market housing and sold data. That is a huge undertaking, especially without full cooperation from all national Multiple Listing Services. Zillow.com can only be as accurate as the available data allows them to be. Zillow.com is also not able to take into consideration local market trends and the impact upgrades make on a property versus the comparable properties.
If you choose to consult the Zestimate®, please consider that a ballpark figure. The Zestimate® is an estimate. The only way to truly get an accurate snapshot of how much your home or a home that you are considering buying is worth is to talk with a licensed real estate agent in your area. Only a local real estate agent can do a true market analysis and opine on the value of a home.
If you would like to check out the accuracy of Zestimates® in your area, click here. If you have any comments, I’d like to hear them. Whether you are a seller or buyer, if you are interested in a personal real estate consultation, please contact me. Allow me to help you navigate the kettles and hills of real estate. You can find my contact info on my website. And don’t forget to subscribe to my blog. –Adrienne Killey, REALTOR®
Written by Adrienne Killey, First Weber West Bend office
Reprinted with permission. See original post at http://kettlemorainerealestateblog.wordpress.com/
In addition to trying to use zillow and a local real estate agent to determine the value of a home, please also consider using First Weber’s Wisconsin Sold Property search.
photo credit photo credit http://www.flickr.com/photos/lwr/6267831999/