Investigating Automated Home Valuation in Southwest Florida’s Turbulent Market
Zestimates® are estimates… they are just for “fun” but are consumers really, really clear on the fact that it’s not reliable? – Matt Rathbun via Twitter
Matt said what some of us in the real estate industry might have been thinking. A lot of us have spoken with both buyers and sellers of real estate that have thrown a street address in the search bar on Zillow® and thought the answer was gospel – grab a slab of granite and start carving. The consumer most especially finds it easy to disregard the small print when the figure is in their favor.
Take for instance any home in Bonita Springs, no, take my home in Bonita Springs, Florida. No one would be more familiar with my home than me, right? Throwing my street address in Zillow® I find a figure for my home that is likely $25,000 over what I would believe the value to be. Better yet, this figure is nearly $100,000 higher than the figure that was given about a month ago for the same exact home.
In this instance, what caused the Zestimate® to be skewed? The comparable properties chosen in this example are about as random as a blind folded orangutan throwing darts at balloons. The subject home was compared with Verandas in Highland Woods, condos in Bonita Fairways and homes 20 years senior to the subject on a canal or on a highway.
Face it folks, I got what I paid for in that free Zestimate®. It’s for entertainment purposes. If I was an average consumer and was I really serious about finding out what a home was worth I’d call a trained professional for a comparative market analysis or get a bonafide appraisal.
If you’re going to put your trust in a free, automated service [to value real estate] you have to expect room for the computer to either make errors or not know that it could be comparing an apple to an orangutans.