You can't trust Zillow and Trulia for Property Value Estimates
Zillow promotes Zestimates and so many consumers think this is good information to receive what their property is worth. Zillow is appearing as the authority on pricing homes. How accurate and misleading is the site?
Well, if you go on their website
http://www.zillow.com/zestimate/
The wording from their own company states the following”
The Zestimate® 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." What is the formula used to calculate these numbers? They go on to say that the data is collected from public or user submitted data, real estate agents, appraiser physical inspect of the home.
Now when has an appraiser ever been to your home? The appraisal cannot be done from the outside of the home only to receive a true value. Appraisers charge for their services, it's not FREE. In order to get a true value on a home, you need to conduct an appraisal.
Again, this is from their website -
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)
Why would they mislead consumers by promoting the site as the Real Estate source to count on. They know most people will not look at the data within their own site; this is why they spend so much money advertising on TV. The commercial paints a pretty picture that you can count on them.
Trulia doesn't even tell the consumer how the values are calculated. They keep their information secret and again, no appraisal is done which gives the true value of the home.
Also view the
"Data Coverage and Zestimate Accuracy" section.
As a consumer using these sites, you need think about why "Banks" do not use this sites if their accurate. Because when loaning money, the assessment has to be accurate, so they do not loan more money than a property is worth or they will never make the profits projected.
Now before I became a Real Estate Agent, I worked years in the IT field. All of the website are funded and built on an advertising platform. They make the site FREE to use and generate money from first popularity of people using, then they get the corporations and business owners to purchase ads. Last they'll start to offer services. Both Zillow and Trulia offer agents advertising on their site because it's another means to the Real Estate business. It's a tool at best, but you still need to contact a professional for the real numbers.
Now if you want to get a true assessment of your property contact the Professional Real Estate Agent, it's free. You will first be given an actual price from data that's more than what's pulled for the websites. When you decide to list the home for sale, the home is appraised before going onto the market.
I wrote this to make the consumer aware of how to use this site because I hear from clients, and see people in forums quoting numbers from these sites.