Most are familiar with the real estate super site, Zillow but can we trust it?
Many have grown to turn toward Zillow for so many of their real estate needs. After all, it’s easily accessible and doesn’t require any human interaction. While these sites offer quick stats and luring values, the main purpose of this site is to generate revenue through its ad sources. You heard that right…. Zillow is out for their best interests which is probably not surprising. The home values provided attract buyers and sellers and the site then offers services to these consumers, selling the consumers information to realtors and lenders.
So is Zillow bad? Not at all – Zillow can be a great place to start your research but be cautious in relying solely on Zillow. This real estate giant collects its data from various public record sources and uses the data collected to calculate values based on algorithms. These automated algorithms aren’t capable of considering property specific details such as a home’s condition, finishes, views or curb appeal. It doesn’t adjust for things like upgrades, necessary repairs or undesirable locations. Algorithm’s can also pick up incorrect information as there is no one verifying their sources. Furthermore, some of the data used to value properties is older and not reflective of current market conditions.
So what can you do to avoid costly mistakes? Hire a licensed professional. A licensed appraiser will provide a current and accurate depiction of your home’s value giving you credit for the specific features that your home offers. You will be provided with a detailed report comparing your home to similar homes that have successfully sold. The downside – it will cost you several hundred dollars and will not access the current competition that is active in your market, lining you up to list competitively. You could also contact a licensed Realtor® and ask for a comparative market analysis of your home’s value. A Realtor should be willing to walk through your home to give you a fair analysis of what your home is likely to sell for, given all of your particular assets and potential challenges. The best part is that you will get professional advice and a market analysis done by a licensed Realtor at NO CHARGE to you! Establish a relationship with a trusted local Realtor and let them keep you informed of changes in your local market. Both appraisers and Realtors will consider all of the factors that sites like Zillow and Trulia simply cannot.
According to Zillow’s Zestimate page, “The nationwide median error rate for the Zestimate for on-market homes is 1.9%, while the Zestimate for off-market homes has a median error rate of 7.5%.” If you want to know what your neighbors paid for their house turn to these online sources, but seek out a professional to provide you with valuation data you can rely on for smart financial decisions.