Zestimates, the home valuation tool from the real estate listings site Zillow, are back in the headlines and not for the reason that the company wants.
Long-time real estate columnist Kenneth Harney took a closer look at the Zestimate in his column this past weekend and determined that the accuracy of the estimates remains a big issue.
“Localized median error rates on Zestimates sometimes far exceed the national median, which raises the odds that sellers and buyers will have conflicts over pricing,” Harney writes. “For example, in New York County — Manhattan — the median valuation error rate is 19.9%. In Brooklyn, it’s 12.9%. In Somerset County, Md., the rate is an astounding 42%.”
To its credit, Zillow admits an 8-10 percent error rate with the Zestimate. And, in an UrbanTurf interview from a few years ago, company CEO Spencer Rascoff indicated that the estimate is provided to essentially be a jumping off tool for homebuyers.
“A Zestimate is a starting point in determining the value of a home; it’s not an appraisal,” Rascoff said. “…ultimately, a home’s sale price is determined by the buyer and seller.”
Before homebuyers start using Zestimates for properties they are interested in purchasing, they may want to take a look at how accurate the estimates are in their area.
This article originally published at https://dc.urbanturf.com/articles/blog/the_accuracy_of_zestimates_questioned_again/9514.
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