A Second Look at Zillow
As client advocates our team is often faced with questions about Zillow, especially as buyers leverage the user-friendly experience as their first point of reference when searching for homes. Plus, we embrace and encourage our clients to use this platform so long as they understand the fine print. Here are three items to understand.
The Zestimate presented by Zillow has a national median error rate of 4.5% (https://www.zillow.com/zestimate/#acc). This simply means that half of the homes sold are within 4.5% of the estimate while the other half, well, are not.
A good example: Zillow’s own CEO sold a home for 40% less than the Zestimate https://www.inman.com/2016/05/18/zillow-ceo-spencer-rascoff-sold-home-for-much-less-than-zestimate/.
In short Zillow said it best ““Remember, the Zestimate is a starting point and does not consider all the market intricacies that can determine the actual price a house will sell for.” https://www.zillow.com/zestimate/#what
The information in Zillow does not always have complete home facts https://www.zillow.com/zestimate/#update. This is especially true as it relates to specific data fields tracked in the Multiple Listing Service (MLS) that may not appear in Zillow. This can also impact the home estimate (see above point 1).
On the flip side note that buyers (and buyers’ agents) should be looking at Zillow as there are homes that appear on Zillow that may not be in the MLS (for sale by owner for example).
While Zillow remains a valuable tool for home searching one must remember what’s driving the site: advertising. Here are two statements pulled from the Zillow site terms https://www.zillow.com/corp/Terms.htm:
“Zillow Group’s business is primarily funded through advertising.”
“Zillow Group does not: … (b) represent you or another user in the purchase, sale, or exchange of real property, including any negotiation thereof;”
This is exactly why you need an agent that always has your best interests in mind. Zillow is a good starting point, but if you have the right agent they will guide and assist you in making sure your interests are protected.