Ask this question to most real estate professionals and savvy real estate investors and the answer is a resounding “yes”! While “Zestimates®” have become quite popular and convenient, they have also led to a lot of confusion and false expectations. For example, it is not uncommon for a seller to see his/her property’s Zestimate® value to be anywhere from up to 50% above to 50% below actual market value. With this said, the various informational tools online that are now available to both buyers and sellers can be quite beneficial as well. Now more than ever, buyers and sellers have access to more educational resources to assist in making informed decisions.
But, Zillow says my property is worth ______…
Nearly all real estate professionals that have ever worked with a seller will be able to tell you stories of clients that have cited a Zestimate® value as justification for an inflated and/or unrealistic price. As with any artificial intelligence, it is impossible for the Zestimate® algorithm to capture all the factors involved in home valuations. For this reason, it is critical to have a local and knowledgeable real estate professional guide the home buying or selling process.
According to the Zillow website, below is the definition of their Zestimate®:
“The Zestimate® home valuation model is Zillow’s estimate of a home’s market value. The Zestimate® incorporates public and user-submitted data, taking into account home facts, location and market conditions.
It is not an appraisal and it should be used as a starting point. We encourage buyers, sellers and homeowners to supplement the Zestimate® with other research such as visiting the home, getting a professional appraisal of the home, or requesting a comparative market analysis (CMA) from a real estate agent.”
Why isn’t my real estate agent sending me this Zillow property as part of my home search?
This is another common question that may be asked by buyers. The short answer to this question is that the listing probably doesn’t exist. In other words, the buyer may have seen this property listed for sale on Zillow or another tertiary real estate website, however it is not a current listing. For real estate agents that are working with buyers, this is one of the most frustrating aspects of properties listed on tertiary real estate websites. While it is possible that a particular property was listed for sale at one time, oftentimes these sites are not up-to-date. This can cause frustration for both the buyer and the real estate agent. As always, the more detailed property search criteria a buyer can give his/her real estate agent, the better.
As mentioned previously, buyers and sellers have more information at their fingertips than ever before. Overall, this is welcomed news and allows for more educated real estate discussions for buyers, sellers, and real estate professionals. With this said, it is important that these resources are also put into perspective. In the end, nothing can substitute the local knowledge and expertise of a real estate professional. One thing to remember is that the artificial intelligence that is powering these valuation models are not able to account for the interior of any property. With this said, we all know how different the interior of a completely remodeled 1970’s home can look, as compared to the same home in it’s original condition.
Do you have questions about the South Florida real estate market? Thinking about buying or selling in South Florida? Contact Live South Florida Realty, Inc. today. We have local and knowledgeable real estate professionals located throughout Palm Beach, Broward, & Dade counties.