Zillow? realtor.com? Get real?
 

We are not buying or selling in either place right now, but I have been fascinated by real estate markets for most of my adult life. Just when I thought I had seen it all — along comes the current insanity.

While I agree with those who say this overall market is different from the big, popped bubble, that does not mean that I think it is sustainable. At some point, buyers will get tired of feeling had and the US market will breathe. (I hope banks do not start handing out HELOCs based on what could turn out to be phantom equity.)

(But TV’s market is different. Potential buyers might feel like they are caught between The Village of Rock and The Village of Hard Place where the buy price is concerned. But no matter what that famous philosopher Mick Jagger told us, a long time ago, time is not on our side — anymore. And, besides, in most cases, the house owned elsewhere is going to sell overpriced. TV marketing knows all this, of course.)

But back to the overall US market. . .

I just now looked at Zillow and at realtor.com to see what their algorithms “think” about what houses we own, and have owned, are worth. On the northern house, both seemed unrealistically high.

How realistic can those sites possibly be? There is no human element involved in the pricing? Are those sites just a starting or stopping point? Are they just pie in the sky? Are they just as often too low on their estimations?

Boomer. . .

(Btw, it is a little weird to look at realtor.com because they do not appear to remove the old pictures from the last time the house was sold. So if you think you miss your old furniture, you might be able to visit it on realtor.com if you listed with the MLS.)

I don't know about realtor.com, but Zillow has detailed information about how they calculate their estimates. Just click on "zestimates" at the bottom of their website and you can see information about how accurate they are, and how their estimates compare to actual sale prices. Some people like to criticize Zillow, but they often forget that it is just an estimate and the real value is what a buyer is willing to pay.

Zillow ranges are so wide they have little use. When a house sells they adjust the Zillow price to it and their algorithms update. Just look at comparable sales on your own

We just sold a house last week. Realtor.com was absurdly low. Zillow was a little high but not by much

We sold our NJ house last month. Realtor.com was also absurdly low, like 25% off our selling price. Zillow was a few thousand low. Our house sold right along with all the comps the realtor pulled, so it was not some ridiculous cash offer 100k over asking. It was over asking, but just about enough to cover the realtor fees.

Zillow is one of the most UNreliable sources for home-buyers ever.

Our house was on the national multi-listing service (MLS) for almost 3 months before Zillow finally acknowledged that it was an active listing. Realtor(dot)com and all the others had it listed just fine, but Zillow hadn't caught up yet.

Sadly, we learned that there were 2 potential buyers who passed our house and tried to find us on Zillow to get more info before calling the agent. Since it wasn't there, they thought it was already sold, and didn't bother. It took us almost a year to sell our home, and we were paying mortgage on a home we had stopped living in and didn't want, for several months at the end.

The only thing I trust Zillow for are the pictures and the addresses themselves.

Zillow
 

As unreliable as they may be, we sold our house because of Zillow in 4 days.

Sold my parent's home on Zillow...........free & easy.

When we refinanced our house was appraised about $50k over Zillow. We are not selling anytime soon. Our Village house has increased about $50k in 2 years.

Yet it's one of, if not THE most used real estate websites out there... Go figure...

Zillow continually undervalued my house for years. Probably because I bought it below market price, it was an estate sale. About 2 months ago, Zillow finally noticed that it appeared every house on my street went for higher sq ft value so they re-estimated the value, more inline with my neighborhood. Since I’m not planning to sell, it is just interesting to watch.

zillow is a generalized algorithm, meaning that it can't know the condition of your house, and it makes location generalized assumptions about your house. Zillow does not know the condition of the house, nor any desirable features unless added and the algorithm can value the feature. Sometimes it will be approximately correct, other times it will be windy wrong.

As compared to a actual paid valuation, Zillow is most likely significantly wrong if the house isn't similar to the houses in the general area, as the paid valuation looks at the condition of the house, etc. and the specifics. Its about 50K off 10% low on my parents house which I just had a professional valuation done, it was 100K (66%) high on my wife's parents' house as the condition of a 250 yo house was not kept up as well as the current houses. But with houses all very similar in the villages, the current valuation is probably a lot closer to an expected sale price than other locations

So again, its just a location generalized algorithm based upon similar house sales in the local area. . . . only a place to start, and with anchoring biases, meaning it was the first public valuation web site where people got their first free valuation, and as an anchor its a place people belief is accurate as they have no other source to evaluate the quality of the algorithm

in other words, its free and you get what you paid for it. . .

finance guy

Yes, it's one of the most used. It's also one of the least reliable with regards to actual value of the homes, and whether or not the home is even available for sale. I saw a home on there last week that said it was available for sale, and it was sold a month ago and had been pending for two months before that. Again, it was an MLS listing from a nationally-known real estate company, so it's not like it was some obscure listing that might take a few months to update.

Go figure, that people might find something useful even in something unreliable.

Sold house in a week using Zillow.,,couldn’t have been happier…

Just sold our house in Virginia. The most accurate "estimate" was Redfin.com which was off by only $10k.

"Least reliable" based on your extensive studies of their algorithms...:ohdear:

Hard to give a real value of your home without seeing it in person. These companies give a range. Most are close in neighborhoods, but unusual properties are more difficult. Always good to get 2-3 estimates from seasoned agents.

Zillow
 

I will never deal or use Zillow. True story here. We bought land and built a beautiful house in NY along the Hudson river. Years later we went to sell, and listed it with a local realtor we knew and trusted as we made our move to TV. Zillow showed it with an absolutely horrible photos and showed the previous sale amount as being what we paid for the land. So now potential buyers see a greedy seller who is asking for 10 times his buying price in 7 years. We tried to get Zillow to correct it, and they did not. Our relator tried to get them to change it and was ignored. Zillow without a doubt adversely affected our time and value on selling that house.

Agree 100%, used Redfin, Zillow and Realtor.com
 

You will get a lot of estimates on these sites, most people don’t do research on the biggest sale, I had a seasoned agent tell me that our home in the Chesapeake Bay (Great Wicomico River) was worth $$$ I disagreed and priced the home 40k over her estimate, home sold in a slow market (2002) in 30 days, I did the research on actual past sales not by square footage but by location in the River (Tributary of Chesapeake Bay).
Do your own research, use the information on Zillow, Redfin and Realtor.com as a guide, base on sales within 2 months, lots of information, however the price is actually set by what the buyer wants to pay!!!!

What's your point?

I always look at these sites to get a general idea of a homes worth. The other issue of how long can this escalation of home prices go on? As long as the market will bear.

It is happening everywhere. A home is worth what it sells for.

who iz u talking 2 ??

The "zestimate" is an estimate. The asking price is the first large bold price you see when you look at a house on the Zillow site. I rarely even look at the zestimate. It is not the price the seller is asking.
I find Zillow a great resource to get a look at a home I might be interested in buying. It helps narrow the choices and provides a lot of useful info.

zillow
 

I am an appraiser in Michigan. Have been for 38 years, still working. We just bought a home in TV. Zillow is considered a recreational site and not relied upon for true, current, accurate values. They are great with the pictures, mapping and they try and keep on reporting sales price information, but to consider them as your only source to determine your value, would be a big financial mistake. Get an appraisal or at least a market analysis from a good realtor.

Even estimates based on current sales can be off simply because the next day the Federal Reserve May raise loan rates or the unemployment figures may come out. You have to use your brain and think about the current situation a little bit. Everything is an estimate until you get a real offer based on a client and has cash or mortgage in hand

That must be why Zillow had our house up north priced $70,000 less than what it appraised for. We had owned it for over 30 years. Bought it for much less than the Zillow estimate of course so They did up the price over those decades but not up to its current value.

What is your point??? Supply and demand determines price.

We sold my mother's house through a real estate agent friend of hers back in February. The agent's suggested listing price was $30K lower than Zillow's estimated price. Mom wanted it listed at Zillow's price and that's what it sold for.

You can ask as much as you want, they can guesstimate what ever they think it worth. But, bottom line is how much it appraises for and how much buying willing to give. Housing market way over inflated right now due or material costs and labor shortages. Bottom line cash is King.

Very true my house sold 7 years ago and still shows my pictures. I think the show last sale of house if it’s off the market. It’s takes some digging not being up old pictures of last sale it house off the market.

If I was selling house in villages I wouldn’t spend dime on interior upgrading, ever house in my neighborhood the new owners remodeled to suit their tastes and in most cases the previous owners spent 10K to 35K plus and new owners just torn it out or redone it.

Hey! Ya talkin’ tuh ME!?

Not that I owe you, or the horse you rode in on, any explanation, but in case it is MY “point” that has you befuddled, I will answer. . .

I absolutely love to talk about real estate markets. I have FSBO’d several times and used agents other times.

Decades ago, I got a license and went through in-house training with the biggest broker in my home city. Played around in it, a little, but did not quit my day job — never intended to.

In those days, we could not afford to maintain the Ohio license and all the associated expenses for what was pretty much just a hobby for me — and full-time had never been considered. Kept my day job for 35 years. No regrets. But everything I learned from spending my “15 minutes” as an agent was valuable — still is.

I hope this thread turns into the sharing of experiences with buying and selling our homes. (That is called “conversation” — OK w/ you?)

Boomer

Addendum: I just looked back after posting this and it looks like I might have picked up another heckler with a “what’s your point” post. Geez. . .So — Queenie whoever — please see above — in case you’re talkin’ to me.)

They use comps, other homes that are the same ( as much as possible, there are unique homes out there lol) as yours ,and the last sale price within 3-5 miles and that is how to get a Willow, Realtor.com and a in person human Realtor. They are as accurate as what is recorded.

Ohiobuckeye
 

I say sell your home who you’re comfortable with! Everybody has their own opinion on Realtors.

To dispel some myths...

Property Value and Property Price are two different things.

Value of a Property - is established by 1. a realtor, or appraiser, using past sales of similar properties, in other words historic data - the past look. 2. by market competition as in similar properties for sale now, the current look. 3. market trend as in have prices been rising or lowering over time, the future look. Property Value is a refined pie-in-the-sky sort of number. It is also perceived differently as in “I wouldn’t buy that piece of junk of a house for $250,000.” OR “Man, at $250,000 that house is a deal! I can do some updates and it would be worth $320,000!”

Typically how we want to Value our homes is $100,000 to the tax assessor, $300,000 to our friends, and $500,000 when we want to sell it. On the other hand...

Property Price - is determined when a property actually sells, defined as what a seller agrees to take and a buyer agrees to give. That’s the hard and real number.

Property Value fluctuates all the time due to innumerable factors. Just one example, when mortgage rates are low, buyers have more buying power, more home sales, prices trend up. When mortgage rates climb, buyers lose buying power and the opposite occurs. Remember, the interest rate is the “price” of money. All sorts of factors come in to play and change all the time. Something as simple as, “It used to be such a nice area, but the traffic is so bad now!” affect Property Value. Hence, in the industry we say “An appraisal is good for only one day.”

Another misunderstanding relates to refinancing. Mortgage companies are a lot less discriminating on Refi appraisals. It not the same as a new buyer. You are already in the home and have been making payments for some time. You a have a good payment history. Lenders see this type of financing as less risky. Don’t confuse the Refi appraisal as an indication of sales price, it’s not. The Refi lender could care less what type of counter tops you have or if your fixtures are still antique brass! A buyer will though.

Another myth is that there is a national MLS. There isn’t. The Multiple Listing Service (MLS) is a service created by the NAR, National Association of Realtors. The NAR is made up of many local associations usually determined by city or counties or whatever geographical area, each with its own MLS system. Only a licensed real estate agent can join the NAR through their local entity and thereby use that MLS. In doing so, they become a REALTOR. You’ve seen that word thrown around. That’s all it means They can access the MLS, you can’t. But that too has been changing. I’ll explain...

The NAR collects listing and sales data from all the local MLS’s around the country and assimilates the information. Nearly all economic data on the real estate industry comes from the NAR. When you see info in the news it is typically quoted from the NAR.

Realtor.com is the NAR. So, information you see on that website is coming directly from all the local MLS’s. It is information entered by each individual real estate agent as they list and sell properties. It’s usually very accurate because agents have to follow very stringent rules when entering info. If not, they can lose their license.

Now as I said before, only licensed agents that belong to the NAR (REALTORS remember?) can access the MLS and you can not. That is still true. However, with the advent of internet property searching by potential buyers and real estate companies setting up resulting websites, the NAR at the demand of real estate companies came up with a way that you, the buyer or seller, could see some, not all, of the MLS info. They allowed agents to “link” some of the info in local MLS’s to their websites. Of course it cost agents $$$’s to do but it allowed you to now search for properties on that agents website directly from their local MLS, updated pretty much instantaneously.

Now comes the fun part... One day some techno people looked at this and said, Hmm we can do that on our own, and maybe do it better, and offer people the property searches (from different sources) AND include other info real estate agents use such as tax records, sales history from the county clerk, school performance and lots of other stuff people might want to know about a property. We can even do a basic Property Valuation maybe. So came Zillow and Trulia (at least they were the most successful)... Then Zillow bought Trullia, you know to get rid of competition. Like Facebook and Instagram, true to the tech world. And Zillow has grown.

Zillow is a good source of some information, but it must be taken with a grain of salt. Zillow is free to buyers and sellers, because on Zillow, you are not their customer, you are their product. They sell you to real estate agents. That’s how Zillow makes their money, mainly by advertising real estate agents. They make it from mortgage lenders, and other advertisers, too. Zillow is another way real estate agents say, “Pick me! Pick me!” It’s just like newspaper ads, yard signs, and billboards. Just with more juicy information :)

And the real estate agent myth... We use financial advisors to help us through these golden years, we see doctors for our ailments, we use CPA’s to do our taxes, lawyers to do our wills, so when you are looking to buy or sell one of our biggest investments, go see a professional. First, definitely shop them, like you do the other professions . Get a good one and they will get you the most current and relevant info, guide you through the process you know little about, protect you from the pitfalls of required representations and disclosures, and get you highest & best net proceeds which is really all you care about.

There will always be for-sale-by-owners, there will always be day-traders, and there will always be a gazillion golfers, but very very few, and probably not you nor I, will be successful pros at any of those.

Previous sale prices are easily researched...

Zillow will only show the pics that YOU give them. I've never heard of them taking pics for anyone...

Is it possible that those were the pics your "trusted realtor" took?

Hence the use of the word "Zestimate"... It's an estimate, based on recent sales, square footage, etc...

Well, yeah... And water is wet... :icon_wink:

That’s the brokerage they kept it off Zillow.. all listings are posted to Zillow immediately unless the broker will not allow it .. they trying to sell it themselves

Not
 

Zillow does not take or post pictures randomly. Pictures are taken from current Google satellite photos. If a picture was posted of the home or land it comes from the listing itself .. inputted and taken by your realtor

Actually, the price is set by what the lender will finance (unless it's a cash deal).

Depends on how badly you need to sell. My neighbor up north wanted money for his living care expenses, this was his last move. He set his price at a good 50% above any valuation. He went through 3 different real estate agents. He waited till a buyer was willing to meet his price. It took more than one year. He was in no hurry, and he advertised abroad too. But in the end, it was a family on the street who bought the house for their child. There was practically no other house for sale in my neighborhood, they had no choice and they had the money. Now grandparents walk over to see the baby grandkids. No one has any regrets.

Not exactly.

The buyer might have $50k cash, $100k cash, $2k.........lender is not setting the price.