Online real estate estimates are garbage.

[Daniel S.]

I recently purchased a home for $245,000.  Before doing so I had been monitoring the price of the property via 3 online sites, zillow.com, realtor.com, and homes.com.   It had been going up very gradually for months on all of these sites and prior to my purchase the values were as follows. Just a very steady climb with no volatility. 

Prior to the purchase here were the values the sites reported:
Zillow: $293,992
Realtor: $269,538
Homes: $232,700

As you know, home sale data takes time to get into government databases that these sites pull their data from, but on the exact day my sale info hit the public domain all the values changes in a way that made them closer to the sale price of 245,000:

Zillow: $288,905
Realtor: $242,484
Homes: $245,024

So its hard to trust these sites are providing relevant data if all they do is simply chase real data.  It seems awfully convenient that right as we head into summer, a time of rising prices for my area (and most areas) that the price would just fall in the case of the first two.  And with homes.com they seem to just be shamelessly matching their price to the real one.   The fact is I got a special deal on this house that allowed me to purchase it for less than it would really sell for, but these sites would never know that. 

[David Dachtera]

What part of "estimate" (even "(Z)estimate") is in any way ambiguous?

Estimates are based on the available information. Software is not clairvoyant. It can only make the best guess the programmer knows how to make based on the information the code can discover, which is going to be the same info a human can gather from on-line resources.

I know - we always want the machine to do the work for us. This is not Star Trek.

It says "estimate" or "Zestimate", not "appraisal" or "Zappraisal".