What’s the Secret to Finding Your True Home Value?

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More and more people are going online to find real estate assistance. There are a lot of great resources on the Internet, and doing your own research is important - but it’s important to be careful about some of the information you find. Sites like Zillow, for example, have some inaccurate information that could really mislead you.

A perfect example of something you shouldn’t trust on Zillow is their Zestimate feature. The Zestimate is an automated valuation model (AVM) that uses public records to come up with a home value estimate. The problem with using public records, however, is that they are often incomplete and outdated; in other words, this method draws data from an unreliable source, and the price it comes up with is usually inaccurate as a result.

Realtors use a tool called RPR, which is a Realtor valuation model (RVM) that draws from public records and MLS data, which is more consistent and up to date than any other real estate information available. The best AVMs on the market come within 10% of the actual sales price only 60% of the time, whereas the RVM comes within 10% of the actual sales price 90% of the time. The difference between the two is obvious: one is way more accurate than the other.

Late last year, we sold a home that had a Zestimate of $179,424. Because we knew the market, the demand for property in the neighborhood, the size of the lot, and the number of upgrades made to the property, we knew the Zestimate was way too low. With the integration of MLS data, the RPR actually projected that the home was worth $193,730, a much more accurate value. Knowing the current market trends at the time and backed by our expertise, we were confident that it was worth even more. Long story short, we priced the home even higher than the RPR value, and we still ended up getting multiple offers and selling for $200,000!

Bottom line, the Zestimate is a useful tool, but it’s not wise to think of the number as 100% accurate. If you would like to work with home seller specialists who are dedicated to making sure no money is left on the table when you sell, give us a call or shoot us an email. We would love to hear from you!

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