Zestimates-Wrong-Inaccurate

Zestimates – Why They are Not Helpful

Why a Home Buyer should never use them

What is a Zestimate?

Zestimate

(Pronounced ZEST-ti-met) – Information is straight from the Zillow Website

The Zestimate® home value is Zillow’s estimated market value for an individual home and is calculated for about 100 million homes nationwide. It is a starting point in determining a home’s value and is not an official appraisal. The Zestimates are automatically computed daily based on millions of public and user-submitted data points.

Zestimates® home valuation is Zillow’s estimated market value, computed using a proprietary formula. It is not an appraisal. It is a starting point in determining a home’s value. The Zestimate is calculated from public and user-submitted data, taking into account special features, location, and market conditions. We encourage buyers, sellers, and homeowners to supplement Zillow’s information by doing other research such as:

  • Getting a comparative market analysis (CMA) from a real estate agent
  • Getting an appraisal from a professional appraiser
  • Visiting the house (whenever possible)

Zillow also produces a Zestimate forecast, which is Zillow’s prediction of a home’s Zestimate one year from now, based on current home and market information. Learn more about the Zestimate forecast.

*For more information on Zestimates directly from Zillow, Click HERE

From: the Los Angeles Times
By: Kenneth R. Harney
Date: February 2015

When “CBS This Morning” co-host Norah O’Donnell asked the chief executive of Zillow recently about the accuracy of the website’s automated property value estimates — known as Zestimates — she touched on one of the most sensitive perception gaps in American real estate.

Zillow is the most popular online real estate information site, with 73 million unique visitors in December. Along with active listings of properties for sale, it also provides information on houses that are not on the market. You can enter the address or general location in a database of millions of homes and probably pull up key information — square footage, lot size, number of bedrooms and baths, photos, taxes — plus a Zestimate.

Shoppers, Sellers and Home Buyers routinely quote Zestimates to realty agents — and to one another — as gauges of market value. If a house for sale has a Zestimate of $350,000, a buyer might challenge the sellers’ list price of $425,000. Or a seller might demand to know from potential listing brokers why they say a property should sell for just $595,000 when Zillow has it at $685,000.

Disparities like these are daily occurrences and, in the words of one realty agent who posted on the industry blog ActiveRain, they are “the bane of my existence.” Consumers often take Zestimates “as gospel,” said Tim Freund, an agent with Dilbeck Real Estate in Westlake Village. If either the buyer or the seller won’t budge off Zillow’s estimated value, he told me, “that will kill a deal.”

Back to the question posed by O’Donnell: Are Zestimates accurate? And if they’re off the mark, how far off? Zillow CEO Spencer Rascoff answered that they’re “a good starting point” but that nationwide Zestimates have a “median error rate” of about 8%.

Whoa. That sounds high. On a $500,000 house, that would be a $40,000 disparity — a lot of money on the table — and could create problems. But here’s something Rascoff was not asked about: Localized median error rates on Zestimates sometimes far exceed the national median, which raises the odds that sellers and buyers will have conflicts over pricing. Though it’s not prominently featured on the website, at the bottom of Zillow’s home page in small type is the word “Zestimates.” This section provides helpful background information along with valuation error rates by state and county — some of which are stunners.

For example, in New York County — Manhattan — the median valuation error rate is 19.9%. In Brooklyn, it’s 12.9%. In Somerset County, Md., the rate is an astounding 42%. In some rural counties in California, error rates range as high as 26%. In San Francisco it’s 11.6%. With a median home value of $1,000,800 in San Francisco, according to Zillow estimates as of December, a median error rate at this level translates into a price disparity of $116,093.

Some real estate agents have done their own studies of accuracy levels of Zillow in their local markets.

Last July, Robert Earl, an agent with Choice Homes Team in the Charlottesville, Va., area, examined selling prices and Zestimates of all 21 homes sold that month in the nearby community of Lake Monticello. On 17 sales Zillow overestimated values, including two houses that sold for 61% below the Zestimate.

In Carlsbad, Calif., Jeff Dowler, an agent with Solutions Real Estate, did a similar analysis on sales in two ZIP Codes. He found that Zestimates came in below the selling price 70% of the time, with disparities ranging as high as $70,000. In 25% of the sales, Zestimates were higher than the contract price. In 95% of the cases, he said, “Zestimates were wrong. That does not inspire a lot of confidence, at least not for me.” In a second ZIP Code, Dowler found that 100% of Zestimates were inaccurate and that disparities were as large as $190,000.

So what do you do now that you’ve got the scoop on Zestimate accuracy? Most important, take Rascoff’s advice: Look at them as no more than starting points in pricing discussions with the real authorities on local real estate values — Experienced Agents and Appraisers.

Zestimates are hardly gospel — often far from it.

Call the Martin Real Estate Team of Lake Norman if you are interesting in Buying or Listing Your Home in the Cornelius, NC Real Estate area or other around Lake Norman…or even if you are looking for more information on Lake Norman Real Estate Values.

704-900-1619

Lake Norman Waterfront Homes for Sale

Lake Norman homes

Listings 1 - 20 of 191   next

159 Wood Duck Loop -- 4 BR, 4 BA
Price: $1,199,000 (3282 sqft)
Subdivision: Lakeside Farm
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Katie Castricone | MLS # 4010846 | Active
21112 Rio Oro Drive -- 2 BR, 3 BA
Price: $1,065,000 (2476 sqft)
Subdivision: Bahia Bay
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John Torres | MLS # 3938146 | Active
110 Cullen Place Lane -- 3 BR, 2 BA
Price: $750,000 (1000 sqft)
→ More info
Cynthia Team | MLS # 3936994 | Active
122 Catawba Air Road -- 3 BR, 2 BA
Price: $399,900 (1514 sqft)
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Karen Browder | MLS # 3897724 | Active
18019 Harbor Light Boulevard -- 6 BR, 7.4 BA
Price: $16,000,000 (15048 sqft)
Subdivision: The Peninsula
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Premier Sotheby's | MLS # 3895525 | Active
17240 Connor Quay Court -- 6 BR, 6.3 BA
Price: $9,900,000 (12042 sqft)
Subdivision: Connor Quay
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RE/MAX EXECUTIVE | MLS # 4002734 | Active
18000 Whispering Oaks Drive -- 5 BR, 5.4 BA
Price: $7,500,000 (7308 sqft)
Subdivision: Point Largo
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Nestlewood Realty, LLC | MLS # 4002519 | Active
8394 Ranger Island Marina Road -- 7 BR, 7.1 BA
Price: $6,500,000 (6692 sqft)
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Nestlewood Realty, LLC | MLS # 4007345 | Active
17815 Largo Place -- 5 BR, 5.2 BA
Price: $5,750,000 (6225 sqft)
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Fathom Realty | MLS # 4005759 | Active
103 Saylors Watch Lane -- 4 BR, 5.2 BA
Price: $4,995,000 (6370 sqft)
Subdivision: Saylors Watch
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Coldwell Banker | MLS # 4005600 | Active
16339 Jetton Road -- 4 BR, 4.5 BA
Price: $4,750,000 (6719 sqft)
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Puma & Associates | MLS # 3938150 | Active
16746 Belle Isle Drive -- 6 BR, 6.2 BA
Price: $4,700,000 (7544 sqft)
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Ivester Jackson | MLS # 3923200 | Active
114 Nautical Point Court -- 5 BR, 6.1 BA
Price: $4,500,000 (11714 sqft)
Subdivision: Nautical Point
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Ivester Jackson | MLS # 3901052 | Active
16446 Pinwhenny Road -- 5 BR, 5.2 BA
Price: $4,400,000 (6280 sqft)
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Ivester Jackson | MLS # 4009623 | Active
2820 Camden Pointe Drive -- 5 BR, 4.1 BA
Price: $4,000,000 (4509 sqft)
Subdivision: Lakepointe South
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Lake Homes Realty LLC | MLS # 4008136 | Active
20911 Cinnamon Tree Lane -- 5 BR, 4 BA
Price: $3,800,000 (5123 sqft)
Subdivision: Keel Bay
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Fathom Realty | MLS # 3922765 | Active
16824 Flying Jib Road -- 7 BR, 7.4 BA
Price: $3,750,000 (7572 sqft)
Subdivision: The Peninsula
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Carlyle Properties | MLS # 4007177 | Active
17429 Staysail Court -- 7 BR, 7.1 BA
Price: $3,595,000 (10458 sqft)
Subdivision: The Peninsula
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Premier Sotheby's | MLS # 3838731 | Active
251 Gainswood Drive -- 4 BR, 3.1 BA
Price: $3,500,000 (4514 sqft)
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Coldwell Banker | MLS # 3931842 | Active
720 Isle Of Pines Road -- 4 BR, 6 BA
Price: $3,500,000 (4173 sqft)
Subdivision: Isle of Pines
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Ivester Jackson | MLS # 3925005 | Active

Listings 1 - 20 of 191   next

Lake Norman Waterfront Condos for Sale

Lake Norman condos

Listings 1 - 20 of 36   next

18635 Harborside Drive -- 3 BR, 2 BA
Price: $735,000 (1381 sqft)
Subdivision: Harborside
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Coldwell Banker Realty | MLS # 4009815 | Active
146 Beacon Drive -- 4 BR, 3.1 BA
Price: $659,900 (3287 sqft)
Subdivision: Waterfront at Langtree
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LKNHomes.com Inc | MLS # 4004015 | Active
18709 Nautical Drive -- 3 BR, 2 BA
Price: $635,000 (1130 sqft)
Complex: Admirals Quarters
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Helen Adams Realty | MLS # 3930075 | Active
8022 Houser Street -- 3 BR, 2.1 BA
Price: $550,464 (2373 sqft)
Complex: The Retreat At West Catawba
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David Weekley Homes | MLS # 4004603 | Active
9003 Charles Francis Lane -- 3 BR, 2.1 BA
Price: $529,588 (2379 sqft)
Complex: The Retreat At West Catawba
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David Weekley Homes | MLS # 3905644 | Active
17768 Kings Point Drive -- 3 BR, 3 BA
Price: $520,000 (2046 sqft)
Complex: Lakeridge
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Helen Adams Realty | MLS # 3931090 | Active
19241 Lake Norman Cove Drive -- 3 BR, 2.1 BA
Price: $460,000 (2339 sqft)
Complex: Lake Norman Cove at Jetton
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Opendoor Brokerage LLC | MLS # 3940277 | Active
8446 Sonata Court -- 2 BR, 2 BA
Price: $420,000 (1867 sqft)
Subdivision: 3 Cherry Way
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C-A-RE Realty | MLS # 4008600 | Active
8443 Sonata Court -- 3 BR, 3 BA
Price: $415,000 (2296 sqft)
Complex: 3 Cherry Way
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Keller Williams | MLS # 3913565 | Active
2453 Royal Anne Drive -- 2 BR, 2 BA
Price: $405,000 (1770 sqft)
Subdivision: 3 Cherry Way
→ More info
COMPASS | MLS # 4011965 | Active
8310 Glacier Drive -- 2 BR, 2 BA
Price: $405,000 (1734 sqft)
Subdivision: 3 Cherry Way
→ More info
EXP Realty LLC | MLS # 4003046 | Active
114 Isleworth Avenue -- 3 BR, 2.1 BA
Price: $400,024 (1810 sqft)
Complex: Forest Lake
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TRI Pointe Homes Inc | MLS # 3918523 | Active
135 Berkeley Avenue -- 4 BR, 2.1 BA
Price: $395,990 (1909 sqft)
Complex: Forest Lake
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TRI Pointe Homes Inc | MLS # 4008320 | Active
104 Burlingame Court -- 3 BR, 2.1 BA
Price: $389,900 (1843 sqft)
Subdivision: Cove at Morrison Plantation
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RE/MAX Select | MLS # 4003777 | Active
4140 Steel Way -- 4 BR, 3 BA
Price: $379,595 (2570 sqft)
Complex: Blackstone
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DR Horton Inc | MLS # 4013524 | Active
4173 Steel Way -- 4 BR, 3 BA
Price: $379,000 (2570 sqft)
Complex: Blackstone
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DR Horton Inc | MLS # 3931396 | Active
4183 Steel Way -- 4 BR, 3 BA
Price: $379,000 (2570 sqft)
Complex: Blackstone
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DR Horton Inc | MLS # 4011226 | Active
119 Berkeley Avenue -- 3 BR, 2.1 BA
Price: $375,990 (1810 sqft)
Complex: Forest Lake
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TRI Pointe Homes Inc | MLS # 4009536 | Active
4187 Steel Way -- 4 BR, 3 BA
Price: $371,795 (2570 sqft)
Complex: Blackstone
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DR Horton Inc | MLS # 3938560 | Active
4124 Steel Way -- 4 BR, 2.1 BA
Price: $369,555 (2395 sqft)
Complex: Blackstone
→ More info
DR Horton Inc | MLS # 4012150 | Active

Listings 1 - 20 of 36   next