Hillside, NJ · Member since 2015 · 148 posts · 27 votes
I've heard on the podcast that you should take what zillow offers ( zestimates, prices and such) with a grain of salt...can anybody clarify or expand on this? Are the prices on this site quality? Are they negotiable? I know there are other sites to check out houses, but so far, Zillow is the first I've checked.
Zillow takes market data and puts it in a neat and marketable format for consumers.
Zillow has never seen inside of any home and is a computer.
If house A and house B are on the same block and house A is remodeled and house B is run down, it will essentially say house B is worth way more than it is, and it will undervalue house A.
If house C is on the same block and in average condition, house C will likely have the most accurate Zestimate.
Regarding are they negotiable, I'm not sure what you mean.
Real Estate Investor · Boston, MA · Member since 2014 · 32 posts · 10 votes
11y
The accuracy of the Zestimates also varies GREATLY depending on where you are located. As an example if you're looking at colonials in Boston built in the 1920's, some have been extensively renovated and others still have the original wallpaper and kitchens. The Zestimate might be way off in this case. As another example if you have a gated community of 200 homes built by a large national builder with only 5 or 6 different floor plans in south florida all built in 2006/7/8 with pretty much the same granite, cabinets, floors etc, your zestimate will probably be much more accurate provided there have been recent sales.
Rental Property Investor · Coopersburg, PA · Member since 2015 · 29 posts · 9 votes
11y
I think Zillow is a great tool if used properly. It allows you to get a decent amount of information on a property for free. Personally, I give no weight to a Zestimate "AT ALL" but I do use the recent sold, tax information, sales history, foreclosure, school ratings, etc... to make my assessment. You need to pay close attention when valuing a property and make sure you are not looking at 2012 or 2013 comps when you are trying to create an ARV but they come in handy if you need a broader search to try and check your numbers.
So in short do not trust any simple sq/ft algorithm or Zestimate trend because it could cost you a lot. You need to collect as much information as possible and come up with the numbers yourself from all the facts you collected.
You also need to look at current and future trends when you are considering a long lead project. This means what you think may be a good ARV today may be 10K or more off in 6 months, so understanding longer term expectations from inventory numbers in your specific location and average sales prices also play in to the mix. I currently almost took down a perfectly good existing home structure in lieu of losing 10 weeks in getting an unexpected variance because I was more concerned with the loss of buyers and home value. I was willing to add 15K-20K to the job to start digging next week to avoid what I feel would have been a bigger loss to lose 2.5 months.
So research yourself and don't just trust other peoples opinions with blinders on and that is what a Zestimate is. Hope that helps.
Investor · Central Valley, CA · Member since 2012 · 6k+ posts · 3k+ votes
11y
I never use zillow. I never even check it. It would never even occur to me to put those numbers in my head. I use real sold comparables. And I compare it to what is currently for sale. You can get real comparables from so many places. Title company property profiles, tax collector and county data, the MLS or an agent, local or national data subscription services. .
There's always the "but that's what the seller has access to and thinks the property is worth". Great. Let the seller tell me what the property is worth based on zillow. I know and have the real comparables. I know have the condition and repair costs. Not zillow.
C'mon everyone. Up your game to a more professional level. Good resources for valuations are everywhere. Zillow is not one of them.
Longer answer: Not only can they not be trusted, but they can be manipulated too.
I have two rental houses in Worcester, MA, I listed under the "Make Me Move" option. Zillow originally couldn't find the houses, and the Zillow people said I could force Zillow to find them with a "Make Me Move" listing. So I did.
The houses are realistically worth between $200K to $240K each, but I listed both at a "Make Me Move" price of $475,000 each. Yahoo! If I got those prices I would "move" and buy 4 houses with the proceeds.
I listed them about 6-9 months ago. Zillow started out at reasonable estimates around $200K each. Since then Zillow has steadily increased the "Zestimate". As of a few hours ago the Zestimate was $305,144 and $446,994. I think it's aiming for my Make-Me-Move price.
My goal this year is to get the Zestimate up to $1 million each. I just need to set the "Make Me Move" price to between $1-2 million each. Wish me luck.
Investor · Central Valley, CA · Member since 2012 · 6k+ posts · 3k+ votes
11y
To be fair to Zillow I went and put in the first address on the notepad next to my computer. Address is for property an agent that called about a few days ago and needs help with a massive title flaw. Zillow's estimate is $130K. Zillow can't know the title flaw or legal costs to solve. Zillow doesn't know about the IRS lien. Zillow doesn't know the property is boarded up and has mounting code violations. Zillow doesn't know agent buyer has contract for $20K.
So I thought maybe it knows ARV. I used last 5 comps available within 60 days, within .10 of a mile. (I said I was trying to be fair.) Based on all rehabbed square footage, all houses 1150-1350 square ft., low comp has this property at $116K, high comp (2 weeks old) has the property at $156K. The Zillow estimate is right there, safe in the middle at 130K. In my markets, many volume rehabbers are working these properties for less than $20K projected profit. You can see why the real numbers would be useful
I've heard on the podcast that you should take what zillow offers ( zestimates, prices and such) with a grain of salt...can anybody clarify or expand on this? Are the prices on this site quality? Are they negotiable? I know there are other sites to check out houses, but so far, Zillow is the first I've checked.
Sure... you can trust that sometimes the zestimate will be way off by a few miles. It is not an appraisal.
Investor · Detroit, MI · Member since 2014 · 755 posts · 462 votes
11y
Here is the Zillow charted value of a house I own.
Here is the Zillow charted value of a house two houses down.
These are for the same time frame what is the difference?
The tax appeal that cut my taxes to less than 1/5 of what they had been appeared on their site. So for the past 90 days the one I own looks like a lead balloon, but we have had 3 record high price sales within 2 blocks in that 90 days.
Auburn Hills, MI · Member since 2015 · 8 posts · 3 votes
11y
Zestimates cannot be trusted. In many cases, the estimates are way higher than what the properties actually go for. The other information that Zillow provides seems to be quite accurate and trustworthy. Great for a quick glance to go from no info on a property to something that may help decide whether to continue or not.
Accountant · Hopwood, PA · Member since 2015 · 125 posts · 92 votes
11y
I would never trust a Zestimate after my experiences in selling our old house and buying our new house.
We sold our old house in less than 30 days for $118k, despite the Zestimate going from $64k to $46k in that time frame.
Similarly, the house we bought was listed at $200k. Our initial offer was $165k, the Zestimate. We almost lost the house due to insulting the seller. Eventually we settled on $185k. For the record, Zillow has it listed as a 3/2, when it's actually a 4/2, but I think that's the fault of the listing agent, who saw the 4th bedroom (the smallest at 10x12) as what the former owners were using it for, a TV room.