Bella Vista at Stone Mountain or Foremaster Ridge? Southern Utah Realtors will host seven open houses today for your viewing pleasure.
Yeah, I’ll probably take some heat for this …
However, since Utah is a nondisclosure state – meaning the sales price of an individual home is not accessible to the general public (including Zillow) – it needs to be said. Zillow’s ‘Zestimates’ are little more than a bad joke on Utah’s homeowners, or would-be buyers.
Now, thankfully, it seems to be that the national media is catching on that Zillow is little more than an ugly attempt by a tech savvy company to extract some cash from technologically deficient Realtors and mortgage brokers — with inaccurate data. Trying to insert themselves into the average real estate transaction, via the deep pockets of Expedia’s former CEO.
According to the LA Times, Norah O’Donnell put Zillow’s chief executive on the proverbial hot seat, quizzing him about the questionable accuracy of the websites automated property valuation – laughingly referred to as a Zestimate.
As most home sellers are already aware, Zillow is the 900-pound gorilla for finding abbreviated real estate information for listings around the country. Charging Realtors exorbitant fees to have their contact information auto populated on every listing within a specific ZIP Code – regardless of whether or not they know anything about that individual property. What the public doesn’t know, is that Zillow then encourages the individual real estate agent to augment that cost by soliciting mortgage brokers to participate in this nightmare scenario. Telling them they can offset their cost by up to 90% by enlisting up to three mortgage brokers per individual agent.
Then, Zillow data mines both the Realtor and mortgage broker. Encouraging them to upload their past sales, post client endorsements – regardless of whether or not there real – and upload their individual real estate listings to the company’s website. In essence, providing Zillow with valuable Search Engine Optimization (SEO) data for free. And every time the Realtor or mortgage broker falls prey to this scheme, they are inadvertently helping Zillow’s ultimate Search Engine Ranking and Placement (SERP).
Per the Times example, “Shoppers, sellers and buyers routinely quote Zestimates to realty agents — and to one another — as gauges of market value. If a house for sale has a Zestimate of $350,000, a buyer might challenge the sellers’ list price of $425,000. Or a seller might demand to know from potential listing brokers why they say a property should sell for just $595,000 when Zillow has it at $685,000,” noting that ” Disparities like these are daily occurrence.” When O’Donnell asked the company’s CEO, Spencer Rascoff about the accuracy of the automated valuation, he stated that they had a “median error rate” of approximately 8%.
The article then gave a poignant example: “In New York County — Manhattan — the median valuation error rate is 19.9%. In Brooklyn, it’s 12.9%. In Somerset County, Md., the rate is an astounding 42%. In some rural counties in California, error rates range as high as 26%. In San Francisco it’s 11.6%. With a median home value of $1,000,800 in San Francisco, according to Zillow estimates as of December, a median error rate at this level translates into a price disparity of $116,093.
Looking to downplay his company’s wild inaccuracies, Rascoff suggested that consumers view their Zestimates as little more than a starting point in the pricing of one of their most valuable asset.
For those property owners looking for an accurate Comparative Market Analysis (CMA) of their property within Washington County, please feel free to contact me. I will then compare your property to the most recently sold comparable homes in your specific neighborhood, with data provided by the Washington County Board of Realtors MLS system. Comparing and contrasting the homes square footage, number of bedrooms and bathrooms, lot size, garage size, and any other applicable variable. When it comes to selling one of your most valuable assets, it pays to have all of the facts.