What Do You Think Of Zillow.com? Homeowners, Please Check It Out.
 

I've been looking at a new website called Zillow.com. http://www.zillow.com

You enter the address of a house, and get an estimate of the value based on recent comps. You can edit the house information, updating the bedroom count for instance, to refine the estimate (your edits are not saved). You can view and refine the comps used as well. Among other output, you can see a graph of the house's value over the past 1, 5 or 10 years.

I looked up some houses in our Berkeley neighborhood and according to Zillow, their values peaked in mid-05 and have come off considerably since. I looked up some Portland houses and, according to Zillow, their values are rising rapidly.

I would be interested if PP BBS folks who are in tune with local RE values would take a look at what Zillow says for their neighborhood, and give some feedback on whether you think the values and the time-series graph look right or not. Somebody like tabs should be able to pretty quickly give this website the "smell test".

I'm currently looking at houses here in Portland and Zillow would be a useful tool, if it's any good.

My father showed me this site just last night. Seems like a pretty good idea, but I'm not so sure the information on it is all that accurate. Especially the part about the assessed value. Well, at least I HOPE it's not accurate....it shows my house to be substantially lower that what I've presumed it to be. :eek:

Going by the comps I've seen elsewhere, I have to believe the numbers on the site are off.

Randy

It has my house undervalued by $175K. It may be more accurate in neiborhoods where houses are similiarly styled and priced. There;s a lot of variation here.

Appraisals vary wildly from one appraiser to another. This is no exception.

It was about $100k low on my house.

Neat site and I think it is reasonably close on our house based on the most recent comps and a 'no-inspection' re-fi appraisal a couple years ago. I'd like to think it is maybe 10% low and it probably is, because the property stats are clearly based on original assessor data as it doesn't reflect an addition done by the PO's 10 years ago...and I'd guess it doesn't 'know' about the pool+spa plus other remodelling & upgrades either, as I can't see how a system based on public records could do so.

I could see the satellite pics and mapping as being extremely useful to 'virtually' cruise around an area before you take the time to go look around in person, especially if shopping long-distance for property! It will be cool to see what emerges in these types of tools in the next few years as the imagery and computing technologies keep advancing at a wicked pace.

It was right on the money for my place.

There's a Pelicanite who started housevalues.com ...way back. This just looks like a copy of that.

Oh, and expect realitors knocking on your door, after you type in your address. Well, some extra junk mail, at least. :)

It has undervalued my house based on a recent appraisal and was mistaken on the number of bathrooms and lot sq footage.

Pretty good for me, but I live in a tract. Easy access to lot and house size. Probably not as accurate for a custom or older home. Just put in the street, not the address. But agree it's a cool site.

Portland has been rising quite a bit over the last 2 years, however the marketing time is getting longer. - signifies the NW is cooling down considerably. Rates are climbing also which will affect the amount of purchase power. To shorten marketing time, the prices will simply drop .

I think we're going to see it plateau for quite awhile, but doubtful the pricing will sink. Unless something bad happens to Portland (major economic shift - jobs lost for instance) it'll be a slower climb.

As for Zillow, as noted above it's largely off of assessor data - which, can be wrong. Alterations, the local county method of measurement, overall mainteance, appeal, and even hard facts (room count) will skew the value - not to mention that the real value is based off of recent sales, not a guess of tax assessed.

That said, it got house across the street from me wrong (sold less than 3 mos. ago) by almost 10% - Proof it's not actually based on closed sales but a markup over tax assessed value.

In order to really be able to get a decent estimate, you need to manually verify the footage and room count, and any other features (view) and use recent sales within a mile or two, and within the last 6 months. Anything else is a guess.

rjp

My estimate at Zillow
 

Zillow doesn't show any house at my address...

I checked mine, and it seems pretty close.

I also checked the last "fixer-upper" I sold, and it wouldn't go there. The address is North, but no matter how I entered the address, the corresponding house on the South side came up.

Doesn't find my home either.

Interesting that you guys have estimates based on appraisal data. The properties I pull up are based on comparable sales in the neighborhood. It gives me 10 comparables that sold in the last 3-9 months and the average price per square foot.

This is just a tool among tools.

I just sold my house and I used Zillow it was very helpful and pretty informative. I like the mapping of the comparables in the area and also the satellite photos.

It has all the tax info on there plus the last few transactions on the house, so it must pull it from the tax assessor's site.

Yasin

I presume Zillow pulls its info from sales and tax assessor data. From the samples I looked at in Berkeley and Portland, it seems to rely primarily on sales (comps) in estimating values.

The more years it has been since a house has changed hands, the more likely it is that Zillow's info is outdated. It won't capture a recently added attic room, bump-out, kitchen remodel, finished basement, etc.

You can try editing the info on your house - correcting the number of beds, baths, sq ft, etc. This changes the estimated value.

In the Berkeley neighborhood that I know best, Zillow's "Zestimate" values seem low, at least for the houses I tried. These are $1MM to $1.5MM homes and Zillow doesn't have any way to distinguish the comp with a $80K kitchen and a "three-bridge view" from the comp with a 1950s formica kitchen and no view.

I suspect that if you carefully select truly comparable comps, and carefully edit the info on your house, you can use Zillow to arrive at a pretty good estimate of value.

The more interesting thing, to me, is the time-series graph that Zillow offers. Try it - it shows the estimated value of your house over the past 1, 5, 10 years.

Zillow's estimate of the % change in your house's value over the past several years is probably more accurate than Zillow's estimate of your house's value at a specific point in time. After all, the unique things about your house that Zillow's automated estimate doesn't capture (the view, the quality, the architecture) don't tend to change over time, so that source of error is pretty constant.

So, if Zillow and similar websites become popular, how will people react to month-by-month changes to their home's paper value? One house I looked at had, in theory, fallen $28,000 in value in the past week.

Normally, it takes a lot of effort to get an estimated value for your house - you have to go to lots of open houses, get an appraisal, consult a broker, etc. Homeowners tend to get these estimates more often when the housing market is exciting and prices are rising - through refinancings, cocktail party chatter, broker solicitations, etc. They tend to get these estimates less often when prices are declining. Thus homeowners tend to remain in denial about their house's declining value for the first years of a housing bear market.

Now, as housing values roll over in some areas, homeowners will be able to see their homes' paper values fall, in near real-time, on sites like Zillow. Even beyond Zillow, real estate listings and sales information is more broadly and quickly available now than ever before.

I wonder how this will affect housing price cycles. Will housing start to act more like markets which are more transparent - for example, the stock market, where changes to a stock's value are immediately known? More transparent markets tend to adjust in value . . . more quickly.

If you are using a bank to purchase a home, then obviously the limiting factor would be the appraisal. Banks simply will not accept value unless several things are established:

How it gets there:

1- the appraiser must identify comparables- typically at least three of like kind and quality.

2)-within a distance of 2 miles and / or the same subdivision

3)- and obviously, whether or not there is anything detrimental to the value (illegal mods, damage, etc)

4)- adjustments for minor ammenities (build quality, upgrades, ) - this is more or less a very small adjustment.

5)- sold within the last 6 months.

For example - If an appraiser notes a dead - on match for the property he's trying to appraise (exact same floorplan that sold last month next door to the subject) - you can pretty much assure yourself that it's the value you're gonna get + / - 0%-3% based on ammenities and overall condition difference between the two.

How the value gets pushed up -

1) Obviously, if a cash buyer comes into the neighborhood and overpays for a home, that will raise the values of homes like the subject.

2) If there are no indentical comps, then the appraiser will find larger / smaller properties within two miles (or best efforts) and adding or subtracting based on estimated cost of square footage. This is the gray area, the banks typically only allow a certain percentage that you can upgrade or downgrade a property to match your subject - this is an area where a lot of value gets pushed. Most of the time this happens.

So, if a greedy seller / realtor pushes the selling price, if the deal is to stick then the appraiser has to find the most comps that will obviously support the value, through a combination of adjusting the subject property upwards to larger / more desirable properties and still stay within the bank guidelines of a two mile radius, less than 12% total gross adjustments (the absolute maximum allowable gross difference a comparable property can be adjusted in value)

Once again, if there's a dead - on match sold within the last 6 monts and within 2 miles, you're done - you have to use it. Only way to get it kicked out if it's a non-arms length transaction or a distressed sale, then it's not used as a comparable.

Summary - for the value to go up, you can't have an identical match within a few miles, and you have to have some comprable sales which are better built and larger that the home has to be compared to within certain limitations. Even the banks are greedy to close and depending on how good your credit is, they may even overlook bad appraisals which don't do a good job of supporting value.

So, it's also dependent on who's buying the home. Better the credit is, the less likely the bank will notice a bad appraisal, therefore the sale will stick and raise values for everyone. This is also a big deal, that can affect pricing by upwards of 10%.

If you're using a bank to buy the home, this is what it is, no ifs ands, or buts.

rjp

In my area, the prices appear a bit high, but not out of the range that I would initially ask for. . We have relatives living in Placentia CA and the prices there for 2,100 sq ft with 7,400 lot size seem to be in the 600k to 700 k rasnge. Compares well with recent sales.

Seemed a bit high for my house, but maybe its just worth more than I think!