Central Ohio Real Estate Market News

Several internet sites claim to be able to determine “your home’s value”. Zillow is the latest dot-com upstart to make this claim.

We all know that placing a value on a home is an inexact science at best, and even though two homes may appear identical on the outside, they can be quite different inside. Their location within a subdivision can be a factor, or even the homes next door can affect value. So how accurate is Zillow? Most agents agree that it’s a “fun toy” but hardly an accurate estimate of the price a home might sell for. There are several reasons for this inaccuracy. You’ve heard the saying, “Garbage in, garbage out!” regarding bad computer data.

PROBLEM #1: Zillow uses county auditor’s assessed values as the basis for their Zestimate. Auditor’s are required to update those values only every three years. Depending on the timing, the assessed value could be almost three years old. The auditor’s data is often incorrect as to the number of bedrooms, the size (sq ft), and upgrades, unless a building permit was required. Auditors make no allowance for interior condition or desirability of other amenities the home has or doesn’t have. Keep in mind, the auditor’s assessed value is established only to be able to calculate property taxes and does not reflect what a buyer would pay for the home.

PROBLEM #2: Zillow overlays recent sales for “comparable” homes, again based on info from auditor’s data. Now what if the “comp” for YOUR home was a foreclosure that sold at sheriff’s auction! Or what if the comp really has 4BR but the auditor is only showing it as a 3BR! Either error can result in the Zestimate being off by thousands of dollars.

PROBLEM #3: Because the data Zillow uses is months/years old, their Zestimates aren’t allowing for current up or down market conditions. Real estate agents who have run checks on homes they’re familiar with have found the Zestimates to be off $20K to $100K!

PROBLEM #4: In many markets, including central Ohio, Zillow cannot access the local MLS system because they’re not a member of the Board and cannot join because they’re not licensed by the State of Ohio, Real Estate Division. Without the MLS data, Zillow can’t know what current homes are priced at, what recent sale prices have been, or have access to more correct property/home details.

PROBLEM #5: Zillow hasn’t been around very long but already a lawsuit has been filed against them for their inaccurate Zestimates affecting the sale of some properties. If you were a seller with a home being undervalued by thousands of dollars, and potential buyers were submitting offers based on the Zestimate rather than the true value of your home, how would YOU feel?

The bottom line … rely on your Realtor® because they know best the difference that your home’s amenities will generate in value in today’s market.

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