Accurate values from Zillow?

Zillow,com announced that they were going to allow people and or REALTORS to upload pictures and indicate of a particular house is for sale.

"Company founders Richard Barton and Lloyd Frink say they can't predict how many people will use the feature, but they are clear about one thing: adding real estate listings doesn't mean that Zillow is moving into the brokerage business. "

Well isn't that a relief. A 57 million dollar company that specializes in dooping the public in to believing that they offer some sort of product worth utilizing; isn't going to get in to the brokerage business.

"With its well-known founders and $57 million in venture capital, Zillow has managed to capture a place in the spotlight. Zillow has also drawn its share of critics, who complain that its home estimates, calculated from public records, are inaccurate.

Barton said that Zillow comes within 10 percent of a home's selling price 76 percent of the time in the Bay Area.

"That's pretty darned good," he said. "

If there is anyone with any interest in the value of their home, doing research for a future sale, or wanting to look up that house down the street; and they are comfortable with a 10% swing in value in either direction - that is just crazy.

I don't know about the rest of the country; but at least here in Shelby County, you can go to the county assessors website and get values that are with in 10%. Feel free to visit the Shelby County Assessors website. Just keep in mind, that these values are what they are being taxed at and not what the home may sell for on the open market.

I'll give you an example. You have very good credit and would like to refinance your home at $200,000 when there is no realistic way for you to sell the property in 90 days for more than $190,000. Yes you can get the loan for $200,000  and Yes the assessor will pick up on the "sale" and adjust your tax valuation to the $200,000; but that does NOT mean you will be able to sell your home next month for that amount.

Here's another example: You own your home for quite a long while with never refinancing. Through normal tax hikes, the assessor only updates the assessed value for tax purposes every five years or so, depending on politics. That means your home may very well have an assessed value well below the true market value because you were fortunate enough to buy in an area with a good appreciation rate.   

So this guy is satisfied with being with in $20,000 on a $200,000 home? Why would anyone be comfortable with being off by $20,000 on the median home price?

Now, this is assuming that they are even that close in their predictions of home values. I have read recently where they had a class action against them for false advertising about the 10%; the allegations were that they were closer to 40% accurate. That is insane!

Have a knowledgeable REALTOR perform a Market Analysis for you, or an experienced appraiser perform an appraisal for you. Do not use these sites for anything other than a very basic, general price range. They are as accurate as throwing a dart at the wall, blind folded. 

"If Realtors show up and bring listings, ultimately that plugs a hole in the site," Sterling said. "The question is how many listings and how quickly."

Sure, it plugs a very big hole. The hole where you have no real value on your site, and at least if folks add true content and information about a particular home, there may be some added value there to offer the visitors.

"We've done lots of testing and we're hopeful," Frink said.

Hopeful. Hopeful some one will find value in the site?

Look, all these type of sites are variations on Automated Valuation Models, or AVM's for short. Mortgage companies use them all the time to "assist" in determining values on homes. They will use 3-AVM's, 2-REALTORS performing Broker Price Opinions, and one appraiser to assist them in determining the value of a particular property. It is a computer program that is only as good as the information it is receiving to perform the calculations. Use a REALTOR!

For more information on home valuations, visit  http://www.memphis-realestate.net/homes-worth.php

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