Today I met with a very nice gentleman to discuss strategies for selling or not selling some of his East Austin properties. During my presentation he stopped me and asked, “What do you think of Zillow?”
The Six-Figure Mistake
I briefly described to him the flaws of national real estate sites like Zillow and Trulia. He then let me know that one year ago his lot in East Austin was valued by Zillow at $250,000. As much as I would love to tell him that’s what he could make by selling his lot, the truth is that the value is much, much lower. This lot would never have been valued at that price even a year ago, yet Zillow gave him the false impression that it was.
For privacy purposes I won’t disclose how much his property is currently valued at, but let’s just say Zillow had priced his Austin real estate at more than double it’s real value – that is a HUGE discrepancy, and it’s a shame when companies like this get people’s hopes up as to what their property values are, and then homeowners use these false numbers to calculate their net worth.
Go Local for Austin Home Values
There are many dangers and pitfalls when using these national online sites, and this is a great example. When you want to know how much your Austin property is worth, contact an Austin Realtor who will be willing to provide you with accurate numbers through a CMA that will show market trends, or hire an appraiser. I am never too busy to help Austinites get the real facts about their property, homes, or condos.
If you’ve had any issues with valuations at Zillow or Trulia , post a comment below.
Tags: East Austin, Property Appraisals, Recent Sales DataComments on "Zillow Strikes Again with Pricing Errors in East Austin"
8 Responses to “Zillow Strikes Again with Pricing Errors in East Austin”
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Yeah, I made a post about their misleading numbers a while back. Their numbers can be way off.
http://braxtonbeyer.com/2009/07/texas-real-estate-market-values-up-over-50-in-the-last-year/
I have had my share of explaining when it comes to national sites like that. I am amazed that company would provide such inaccurate data. I would think they would serve the public better if they did not offer it at all.
Hey Shannon – Sara from ZIllow here.
First, we try to make it very clear that a Zestimate is just a starting point, and we obviously have never been in the house (or on the lot, as in this case!), so most definitely people should contact a real estate professional for accurate, customized information.
Further, we actually post our accuracy rates at the bottom of the page for almost every county in the country. So people can see exactly how accurate we are (or aren’t).
But to your county specfically – TX is a tough state for us, as I am sure you know because it is a non-disclosure state. And actually, we recently quit getting some of the little data we did have on your county. So when we don’t have enough information to come close, we don’t do a Zestimate at all. In fact in your county, we have very few Zestimates on homse at all. You can see that here:
http://www.zillow.com/howto/DataCoverageZestimateAccuracyTX.htm
@Zillow:
When I go to your website I do not see it made very clear how inaccurate your data is. You can send a link saying that, but I bet your data shows that people do not dig around in your site enough to actually find it. That is why I stated that if you cannot offer accurate data you should not.
The Zestimate is not the only issue. Your site is constructed in such a way that encourages the visitor to be confident in what you offer and in my opinion offering data that you know is false is not very nice.
Just to say that you disclose it is not enough because as I said you know many people never even see your disclosure.
How can your site say accurately what loses and gains are, when your information is so far from accurate? To even have the option to view the information implies that you actually have it.
Texas is a non-disclosure state and in my opinion your site should reflect that and it does not and that is not being forthright about the kind of data you really have to offer.
So once again another story of how an agent has to go explain to someone why they their information is so far off.
My question to Zillow are:
What percentage of people who get a zestimate actually read the disclosure?
What percentage of those really understand it?
Why do you offer Zestimates when you know they are innacurate?
Why not pull that information down in areas where it is no good?
Could you make our jobs a little easier and give this disclosure on your letterhead so we can give it to our prospective clients when we go to our listing appointments?
Sara, you say that you have very few Zestimates in our county at all but the link you gave shows that 99% of the homes have Zestimates. Which is it?
Braxton:
quote from zillow re: data accuracy:”Last updated: October 21, 2009
Note: Zestimate accuracy is computed by comparing the final sale price to the Zestimate on or before the sale date. The data herein is computed for the three-month period ending June 30, 2009.”
Sara said the lack of info in Travis county was recent- possibly after 10/21/2009 and definitely after 6/30/2009. I know that none of my homes in Travis now have zestimates.
Zillow is wrong because realtors like you have been successful in keeping market data private. It is more than a bit unseemly for you then to turn around and criticize Zillow for a situation your create and perpetuate.
Thank you all for your comments.
George:
“Realtors like me” did not make Texas a non-disclosure state. The state of Texas did through laws that were passed by voters.
Actually, I think a non-disclosure state offers more benefits than downsides for a Texas homeowner or commercial property owner.
Here’s two examples that immediately come to mind:
A homeowner doesn’t want the world to know what he paid for his house, because it isn’t anyone else’s business. This could benefit the homeowner further when it comes time for the tax man to appriase his home. If the tax value is too high, he can protest the appraised value with comps from a Realtor or licensed appraiser. If the tax value is too low… Enough said.
A commercial property owner doesn’t want his competition to know what he paid for his project when he decides it’s time to sell. Since commercial property pricing is usually derived from a mathematical formula including Rate of Return, Triple N, and other factors, you can easily see how disclosure of this information could cannabilize potential returns for investors in commercial real estate.
The real issue here is Zillow. Even though Texas is a non-disclosure state, Zillow insists on trying to find ways to compile valuation data that web searchers like yourself would mistakenly consider to be accurate.
My client was shocked when he learned what the real value of his East Austin property was, and this “big surprise” would not have happened if it weren’t for innacurate data compilations by companies such as Zillow.
The bottom line is if you want accurate information, don’t be afraid to contact a Realtor who specializes in your area. Any good Realtor will gladly provide you with an abundance of information to help you properly value your real estate.