Zillow Valuation | Fact or Fiction

Zillow is cool.

I don’t want anyone to think that I’m out bashing Zillow for some reason… I think Zillow is a great product offering to those in the market for a home.  They’ve clearly been successful at providing buyers the necessary online tools for doing research, comparing neighborhoods, etc. 

However, too often I hear someone say, before making an offer, that “Zillow says it’s only worth $xxx,xxx.”  I would like to point out that there is no Wizard of Zillow behind a curtain that is all-knowing when it comes to real estate values.  By their own admission, Zillow is not 100% accurate and they’re very forthcoming with how accurate they actually are (see the next paragraph).  Their valuation of a property is just an algorithm that takes in to account a bunch of sales data and then spits out a number (yes, I’m over-simplifying, but that’s basically it).   

How accurate is a Zillow valuation?

Follow the link to see how accurate a Zillow valuation is.  I won’t re-explain everything that they do on the site, because they do a good job of defining their terms and giving information in an understandable format. 

I did do a little case study just to give a couple of examples from specific properties that have sold recently.    

 Example #1.  934 Waterman Rd. S.

  • Zillow valuation at the time of sale = $388k
  • Actual sales price on the date the Zillow valuation was pulled = $315k
  • Margin of Error = 23% over priced

 

Example #2.  8402 Papelon Way

  • Zillow valuation at the time of sale = $329,100
  • Actual sales price 2 days before the date the Zillow valuation was pulled = $450k
  • Margin of Error = 37% under priced

Takeaway

Yes.  Zillow is a good tool for familiarizing yourself with neighborhoods in the Jacksonville area.  But, when it comes to formulating an opinion about the value of a specific property…  It’s best to incorporate a human element – A Jacksonville Realtor® for example – to get some real life information and assess one by one the comparable sales data. 

Cheers!

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