This is big news to me because of my recent affinity I've found for Zillow.com.
Zillow is a great marketing tool for real estate agents (like myself) and for sellers that are thinking about representing and marketing their own property. The drawback that most have with Zillow is that they offer what they call a 'Zestimate' when you enter in a property. Jay Thompson sums up what Zillow provides and 'Zestimates' are.
Zillow.com provides an "AVM" (Automated Valuation Method). Punch in an address, and it will spit out a "Zestimate" — an ESTIMATED home value.
Truthfully, for whatever reason, Zillow is not very good with their estimations of market value in Mohave County. I think that is partly due to where they get their data from for the most part... Mohave County. MC offers a valuation that is not based on sale price when you search public records. If you search public records on property you will see a Land Value, an Improvement Value, a Full Cash Value, an Assessed Full Cash Value, a Limited Value, and an Assessed Limited Value... add them all up - divide them by a prime number - carry the 2 - and solve for the square root and you will get a clear picture of actual value... actually no you won't.
None of it makes any sense, nor is it any help in determining market price. It is my belief that Zillow uses some, most, or all of this data the county offers to come up with their 'Zestimate' which would explain why their estimate is normally way off and very low in this local market.
I am paid to successfully market and sell property in my clients best interest. Part of this means placing the listing on the market for a price that will attract a buyer AND appraise for the value agreed to by the buyer and seller. I'm much better at this than Zillow ever can be because I actually exist in human form number one, and I have the ability to compare like property to like property because I have better data, the MLS. Zillow and their 'Zestimates' can not do a better job than I can at helping clients set a price on property for the sales market. If a buying or selling client brings up the term 'Zestimate' it is merely an opportunity for me to prove my expertise... and I don't lose to Zillow or their 'Zestimate' ever.
The same goes for a professional appraiser. An appraiser has all the skills needed to place a value on a property. One of their very best tools to help them is access to our MLS.
Zillow and their 'Zestimates' cannot do a better job than an appraiser because appraisers locally actually exist in human form and can touch, see, tape measure the property (plus whatever else it is they do) and view actual recent sales data in order to determine a value for their reports.
Realtors should not fear the 'Zestimate'... and appraisers should not fear the 'Zestimate'.
But apparently they do.
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