November 10, 2021

Market Watch: "It’s really a toy"

How reliable is Zestimate, Zillow's extremely popular home-valuation tool?


...some are asking about the reliability of the company’s so-called Zestimates, which provide an estimate of a home’s value based on a proprietary formula.


“We’ve determined the unpredictability in forecasting home prices far exceeds what we anticipated and continuing to scale Zillow Offers would result in too much earnings and balance-sheet volatility.”


In light of the challenges Zillow faced with its home-buying efforts, some people took to social media to call into question the accuracy of the Zestimate tool. “It’s really a toy,” said Mike DelPrete, a real estate analyst who tracks the iBuying sector. “It’s meant to drive people’s interest in property.”

"Zestimate at $349K despite comps being above $600K"

By Lawrence Schoeffler • September 15, 2023
@SacAppraiser | Ryan Lundquist Zestimate history. This property in Roseville listed at $349K, and the Zestimate matched the list price at $349K despite comps being above $600K. After 11 days the price went to $699K (sold $638K). Today's Zestimate shows no history of $349K. Maybe a brief Zestimate gets erased?

"The Zestimate Was Actually 25% Lower"

By Lawrence Schoeffler • August 16, 2023
How Accurate Is My Zestimate Home Valuation? | The Jill Biggs Group Have you ever wondered just how accurate Zillow's Zestimate really is when it comes to estimating the value of your home? 🏠💰 In this video, we delve into the world of Zestimates and break down the factors that influence their accuracy. 🔍 What is a Zestimate? The Zestimate is Zillow's proprietary home valuation model that provides an estimate of a property's market value. By utilizing a mix of public records, Multiple Listing Service (MLS) data, and user-contributed information, Zillow's formula calculates an estimated value. The model also takes into consideration various factors such as property details, location, and current market trends. 📊 How is a Zestimate Calculated? Discover the intricate details behind the algorithm that powers Zestimates. We'll explain the data sources used, including publicly available records and user-generated data, and how these inputs are processed to generate an estimate. Uncover the role of MLS data and how it contributes to refining the accuracy of the Zestimate...
Don't Believe Online Home Value Estimates

4 Reasons Why You Shouldn’t Believe Online Home Value Estimates

By Lawrence Schoeffler • June 24, 2023
"Those online estimates are simply that: estimates" | Barbara Bellesi Zito My husband and I browse real estate listings occasionally, but we’re perfectly content to stay where we are until both the market and mortgage rates behave themselves again. For kicks, we recently checked out the estimated value of one very interesting listing: our own home. The number surprised us both. “Should we call a real estate agent and start packing?” my husband asked. We came to our senses, of course, fully aware that those online estimates are simply that: estimates. But if this particular site were indeed to be believed, our house was worth $122,000 more than what we bought it for seven years ago. Another listing site pulled up the same figure, while a third offered a more conservative estimate, which was still $68,000 more than what we paid. I did reach out to a few real estate agents, not to list our home, but to get their advice on whether anyone should believe those online home value estimates. Here’s why they think you should take what you see with a proverbial grain of salt...
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