When we meet with clients and ask what they think their home is worth, nine times out of 10, they tell us the number Zillow gave them. While Zillow is a good place to initiate the selling conversation, it should not be used as a final authority. In fact, Zillow’s Zestimates are notoriously inaccurate.
A perfect example of this is the fact that Zillow’s own CEO, Spencer Rascoff, sold his home last February for 40% less than his own Zestimate. How does this happen? There are five factors that Zillow doesn’t take into consideration when calculating home value:
- The local demand in the market.
- Your location in a specific market. For instance, whether you have views or not can mean a vast difference in price point.
- An irregular lot size.
- Proximity to busy streets and freeways. If you’re close enough, the traffic noise can have an impact on value.
- The upgrades in your home. Zillow cannot walk into your property and place a value on all of the features inside your home.
Zillow is particularly inaccurate when assigning values to properties in the luxury market because there are many intangible factors that impact value in this specific market, along with non-quantifiable data that dictates value. Zillow simply uses an algorithm that pulls numbers from big data. If you want a more accurate idea of what your home is worth in the current market, you need to talk to a real estate professional.
If you’re considering selling or have any more questions about the Zestimate, by all means feel free to give me a call or send me an email.