JL's Columbia SC Real Estate Blog: My Zestimate is You're Going to Lose Money

My Zestimate is You're Going to Lose Money

 With all the websites available to consumers today, it's easy to research most any topic you choose. When it comes time to list a house on the market for sale, there are plenty of options out there for you to take a look at on line. Zillow is one of the more popular as is Realtor.com. However, there is still substitute to good old fashioned professional help.

 When studying the MLS to price a house for the current market, just for the fun of it, I usually check Zillow for their Zestimate of the property. I have yet to see a single Zestimate that is in line with fair market value for the areas that I research. In fact, I have yet to see a single Zestimate that was not below fair market value and in most cases by several thousand dollars. One of the last houses that I listed there was a $10,000 difference in the market value and the Zestimate at the time the market analysis was done.

 Taking this in to account, even if you hire a Realtor to sell your house, you would still make more than you would if you used the Zestimate to price the house. As I said, this is not an uncommon occurance. Most people who decide to sell their home without the aid of a real estate professional either underprice or significantly overprice the house. Also most people do not know how to effectively market the house, there is a lot more to it than throwing a sign in the yard and posting it on a few websites.

 Most Realtors will do a free market analysis on your home, and I am no different. I offer the service to anyone who is interested. At the very least, if you are considering an attempt to sell your house yourself, you should contact a Realtor for proper pricing and any advice that they would be willing to give you. Don't short change yourself by believing every website that you run across in the gospel truth, the sad fact of the matter is that most of them are not. It never hurts to get a professionals opinion on the subject, after all, they are professionals on the subject.

 

This message brought to you by www.jlboney.com.

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JL Boney, III - Columbia, SC Realtor - Coldwell Banker Residential Real Estate

 I specialize in Columbia, SC real estate and the surrounding areas, including Blythewood, SC, Kershaw County, Fairfield County, and Lexington, SC. If you are in the market to buy or sell a home in Columbia, SC or any of the surrounding areas, I would love the opportunity to speak with to see how I can help. Thanks for reading and feel free to contact me if I can be of service to you.

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Comment balloon 18 commentsJL Boney, III • January 03 2009 03:10PM

Comments

JL...I have been finding that also.  It seams that the web sites are driving the prices down and not giving up to date accurate information to the general public!

Posted by William Feela, Realtor, Whispering Pines Realty 651-674-5999 No. (WHISPERING PINES REALTY) almost 10 years ago

JL...

These low estimates drive me crazy...at some point I think they might incur some liability!

Posted by Richard Weisser, Richard Weisser Retired Real Estate Professional (Richard Weisser Realty) almost 10 years ago

Bill- I certainly agree that all the info is not accurate, and it's going to cost people money.

Richard- It's a possibility.

Posted by JL Boney, III, Columbia, SC Real Estate (Coldwell Banker) almost 10 years ago

Real Estate is LOCAL. A Zestimate is like toilet paper, Best purchsed in bulk with no concern to quality.

Posted by Cameron Wilson, The Short Guy - Murrieta,Temecula,Menifee Californ (Labrum Real Estate) almost 10 years ago

Cameron- I can agree with that.

Posted by JL Boney, III, Columbia, SC Real Estate (Coldwell Banker) almost 10 years ago

There is the other end of the spectrum too.  Many in my area are way too high.  I've seen sellers leave print outs of Zestimates on their counters for buyers to see. The Zestimate will say something like $195k and the seller has it listed for $175k, and yet $175k will probably be too high... Zillow is just way off, especially in non-disclosure states like Texas.

Posted by Donna Harris (RE/MAX) almost 10 years ago

JL - I had to comment because I liked the title alone.  Very well played!

Posted by Jason Crouch, Broker - Austin Texas Real Estate (512-796-7653) (Austin Texas Homes, LLC) almost 10 years ago

Dallas- In my area I have yet to see one that's too high, but I'm sure there are some in other places such as your area. Either way, too high or low, s not good.

Crouch- Does that mean you do not like the post, only the title?

Posted by JL Boney, III, Columbia, SC Real Estate (Coldwell Banker) almost 10 years ago

JL - Zestimates are a joke.  No other way to explain it.  It may work in some markets, but not here!

Posted by April Hayden-Munson, Brookfield Wisconsin Real Estate almost 10 years ago

 I'm sure Zillow is a good organization, but their valuing system just blows.  If folks want to know what the real value of their home is at any given moment in time... contact a professional Realtor or an appraiser.  Everything else is just Internet hype. 

Posted by Jesse & Kathy Clifton, Retired (Jesse Clifton & Associates, REALTORS®) almost 10 years ago

JL,

You would think that after all this time they would hav their act together.  But you are right folks need to call aprofessional to get the answers to their questions.

Posted by Don Rogers, Realtor, Broker, CDPE, GRI, OnullFallon MO & St Charles County MO homes (Keller Williams Realty Chesterfield) almost 10 years ago

April- That's exactly how I feel.

Jesse- I'm sure they are, but their ability to put a proper price on a house certainly isn't that great.

Don- They have yet to figure out a way to make things add up, that's why there are local experts.

Posted by JL Boney, III, Columbia, SC Real Estate (Coldwell Banker) almost 10 years ago

JL - Well written.  From the title on...what do you get for free?  Exactly what you paid!  HA!  How can they be taken seriously.  They are web designers but whomever they hired for the market analysis ought to be "outsourced".    Happy New Year!  

Posted by Suzanne McLaughlin, Sabinske & Associates, Realtor (Sabinske & Associates, Inc. (Albertville, St. Michael)) almost 10 years ago

I agree... their zestimate has been vastly off in the ones I looked up. Pour enough marketing money into something though, and somebody will click the link.

Posted by Jesse & Kathy Clifton, Retired (Jesse Clifton & Associates, REALTORS®) almost 10 years ago

Whether it's Zestimates, RealtyTrac or any other of the million sites out there, you can't beat a free Comparative Market Analysis from a qualified professional!  Good post JL!

Laura G 

Posted by Laura Giannotta, Your Realtor Down the Shore! (Keller Williams Realty - Atlantic Shore ) almost 10 years ago

Suzanne- You do get what you pay for in life, thanks for stopping in.

Jesse- I applaud their marketing efforts, but there consumer information leaves a little to be desired.

Laura- It's hard to beat a local expert when you're not one. None of these sites focus on any particular area.

Posted by JL Boney, III, Columbia, SC Real Estate (Coldwell Banker) almost 10 years ago

Hey JL- Sara from Zillow here.   Just wanted to chime in on what exactly a Zestimate is- a starting point.  A computer generated number to give people a ballpark number.  Not something that one should use to price a home to go to market, and certainly they should seek professional guidance before making a major financial decision. 

We try to be upfront about our accuracy in three main ways:

1) We publish an accuracy chart found at the bottom of every page and behind every Zestimate.  This show national numbers, but you can also drill down to your county.  For example, in Richland County we have a margin err rate of 8.5%.  This number is determined by comparing the Zestimate to sold transaction data the day the property sells, and calculating an err from there.  Many Realtors will use this to example why Zestimates are off. 

2) Behind each Zestimate is a link to a disclaimer that says "..It is not an appraisal. Use it as a starting point to determine a home's value...."

3) Most homes not only have a Zestimate, but also a value range.  This alone should tell people that we don't know exactly what a home is worth, otherwise there wouldn't be a need for a range.  How wide the range is can be dependant of how high the err rate for the area. 

Hope this helps. 

(PS - I think you mean there is NO substitute to professional help, in your first sentence.  A statement which I could not agree with more!) 

Jesse- Interestingly, Zillow has not spent a dime in consumer marketing since Zillow's inception.  Approximately 85% of our traffic comes from people directly typing Zillow into their address bar or into a search engine.  Our intent is to build a product that is interesting enough to make people tell their friends about it or want to come back to the site frequently.  So far this seems to be happening, as last month we had our best traffic month ever with 5.8 million unique visitors coming to the site. 

Posted by Sara Bonert, Real Estate Internet Marketing (Zillow) almost 10 years ago

Sara- I admire you taking up for your company, and no, there is no substitute for professional help. Thanks for stopping in and feel free to come back anytime.

Posted by JL Boney, III, Columbia, SC Real Estate (Coldwell Banker) almost 10 years ago

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