This tops a press release that Zillow issued last week:
Real Estate Information Marketplace Leverages User-Submitted Data to Add More Than 25 Million New Zestimate Home Valuations, Improve Accuracy
Boasting about an increase of its data to 100 million homes nationwide, Zillow declares:
The Zestimate median margin of error is now 8.5 percent nationwide, and below 6 percent in major metropolitan areas such as Denver, San Diego and Washington D.C.
The acknowledged margin of error previously was 12.3 percent. (Notice, how I cunningly qualified the percentage with “acknowledged.”)
Sellers who are 12.3 percent off on the listing price of a property will find themselves condemning themselves to an eternal wait for their objective to be reached, like some god in Greek mythology, for a buyer to make an acceptale offer. Even a price that is 8.5 percent too high almost invariably proves to be a mistake, except at the highest end.
To its credit, Zillow offers the following disclaimer:
Zestimates are a starting point in determining a home’s value; together with a home’s value range, comparable recent sales, and current listings, Zillow’s information helps consumers gain an edge in real estate and make more informed decisions.
I am, of course, biased against Zillow. I don’t want sellers or, for that matter, buyers to make their own decisions without taking advantage of my expertise and experience. And Zillow has taken plenty of heat — well deserved, I maintain — from the brokerage community for its Zestimates.
But, really, how can the site be proud of an error rate that could be so far from actual value. It takes no account of a property’s condition, the distressed property next door or impending changes in the neighborhood, a sewage-treatment plant, for example. The list of circumstances affecting value is a long one.
Still, lots of folks check the site, and I hope they understand the caveats.
All in all, I guess I have to laud Zillow for the progress it has made. But consider my congratulations begrudging and far from hearty.
Licensed Associate Real Estate Broker
Senior Vice President
Charles Rutenberg Realty
127 E. 56th Street
New York, NY 10022