Are Zillow’s Home Value Zestimates Accurate?

Mortgage with Manny Gomes

The website Zillow came on the scene many years ago, serving as a way for people to see what their homes were worth. Today, it has become a popular tool that most homebuyers now use to gauge what their home would be worth if they chose to list it. This has become a huge pain for consumers who are looking to get an accurate sense of their home’s worth. Why? Because, while it can be fairly accurate at times, it can also be really off. For this reason, Realtors tend not to like Zillow. It provides a false estimation of a home’s value. Let’s break down how Zillow actually calculates the value of a property: They use an algorithm that averages out the square footage sales price for a home in your immediate area that is comparable to your home’s own square footage, bedroom count, and bathroom count. This would work if we all lived in cookie-cutter neighborhoods, where all the houses are identical. But that’s not the reality of how most people live. There are always new homes being built in neighborhoods, so if you have the nicest, newest home in an area of older, dated, smaller houses, Zillow will really drag down the value of your property. “If you’re thinking of listing your home in the near future and want to ensure that what you’re offering is reasonable, don’t rely on Zillow.” On the flip side, if you have a very dated, smaller property in an area dominated by newer, larger homes, Zillow will make your home appear much more expensive than a potential buyer would ever realistically pay for. This is one of the reasons why there’s a large discrepancy between what a real estate agent may value your home at and what the Zestimate says. My advice to you: If you’re thinking of listing your home in the near future and want to ensure that what you’re offering is reasonable, don’t rely on Zillow. Talk to a real estate agent who is attuned to your market area. If you have any questions or need a recommendation for a Realtor, reach out to me. I’d be happy to help you.