Zillow estimate accuracy

[Eric Finn]

I know that Zillow estimate are not extremely accurate, but i am curious if it could be a quick way to see if property Could be a good deal. With flippers and Brrrr investors how close is it after you refinance or sell from that estimate?

[Jeff Copeland]

This will vary widely from market to market, depending on Zillow's access to market data. 

Zillow openly explains this at https://www.zillow.com/zestimate/ and publishes their median error rates and other stats for some major metro areas at https://www.zillow.com/zestimate/#acc.

The good news is, it's relatively easy to validate how accurate it is for your market:

• Have your realtor pull 50 or 100 active and sold homes in the market/neighborhood you want to analyze.
• Compare actual asking and sold prices to the Zestimate for each one, put them in a spreadsheet, and develop some averages. 

If you can say with confidence that the Zestimate is usually within 10% of reality in your market, or is consistently 20% high (or whatever), then it can be a useful rough screening tool for a quick desktop analysis. 

This works in some markets, but it others the variability makes it useless.