Zillow Zestimate of $1.5 million on an $8.5 - 9 million home!

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Real Estate Agent with HER Realtors

Columbus This week Real Living announced they are going to put all of the Real Living listings on Zillow now... 

Zillow Welcome Real Living (and their 14,000 daily listings) 

I've had a "love/hate" make that a  "luke warm acceptance / not fond of " relationship with Zillow since before Zillow was public.  I have flip flopped a few times...

Don't make me defend Zillow! 

On TechCrunch I read an  8.5 to 9 million dollar Columbus Ohio home is Zestimated at 1.5 million dollars? Really?  That's seriously out of whack.  That seller has certainly  been "Zillowed" huh? 

A comment on a TechCrunch post...about Zillow 

# Erick  January 10th, 2008 at 10:25 am

I have a friend who's parents own one of the most expensive houses in Columbus OH. They are selling it for 8.5-9 million dollars. Zillow zestimates it at 1.5 or so. That's REALLY lame. I dont understand the issue since the comparibles in the area are around the 4 to 5 million dollars i believe so 1.5 just seems real off.

 
On my other blog, ColumbusBestBlog.com I have a post about Zillow today, Lifestyles of the Rich and Famous title
edit title changed to:. Zillow values $8.5 - $9 million home at $1.5 million?   after watching my stats.  
We don't have a lot of homes in the 5 million plus price range in Central Ohio. The home Erick is referring to on TechCrunch is in New Albany Ohio, a suburb of Columbus.  In a later comment Erick says the home is in New Albany.
 
Real Living  - Zillow History 

February 2006 - The very first day that Zillow ever was...  there were Real Living ads on Zillow.com.  Not ads for properties, Zillow did not have ads for properties at first.   The ads were ads for Real Living Franchise. Good exposure.

September 2006 - Real Living started added Zillows AVM - Zestimates to their sites.  Zillow and Real Living were partners.  

December 2006 Real Living pulled the Zillow AVM off the company websites, when Zillow announced they were adding listings to their site, making Zillow a place for consumers to search for homes for sale.

January 16, 2008 Real Living announced they are putting all of our listings on Zillow for better exposure for our sellers. Change... I set up an account on Zillow on January 16, 2008.

TechCrunch last week... Erick and the 8.5 to 9 million dollar home in Columbus that is Zestimated at 1.5 million dollars?  Read more about it here...  Lifestyles of the Rich and Famous  edit title changed to Zillow values $8.5 - $9 million home at $1.5 million?  

Look for Central Ohio homes priced at 5 million dollars and above here: Search Central Ohio Homes

It's not a long list. You can pull the Zestimates yourself on Zillow, for the two New Albany Ohio homes on the market priced over 7 million dollars.  The Zestimates are low compared to the list prices of the two homes priced over 5 million dollars in Central Ohio today, but neither is Zestimated at 1.5 million dollars. Maybe the Zestimate was 1.5 million  dollars and was corrected but the Zestimates now are close to the auditors tax values of the homes.   The homes are valued over 4 million dollars.  That's a lot of money in Central Ohio.

Erik's Columbus Ohio Zillow story is a great story... but it's wrong. I hate to defend Zillow!

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Ambassador
2,396,804
Lenn Harley
Lenn Harley, Homefinders.com, MD & VA Homes and Real Estate - Leesburg, VA
Real Estate Broker - Virginia & Maryland

I'm not sure I understand the point you're making.  If the home should be prices about $4.5Million for value, the Zilliow estimate is a good $3Million under.  The listing for over $8Million just makes it look severely overpriced for a listing. 

I still believe that the Zillow estimates is severely flawed.  Other than consumer interest it serves no purpose in real time real estate valuation.  For years we tried to educate buyers that Assessements for tax purposes does not reflect market value in real time.  Now we have an entire country looking for tax essesments for real estate values. 

It serves no purpose but to sell ads. 

Jan 20, 2008 06:43 AM #1
Rainer
138,968
Jay McGillicuddy
Berkshire Hathaway HomeServices Verani Realty - Exeter, NH
Real Estate Broker

We were aske dto put a value on a home a coupl eof weeks ago and their Zestimate was 430K and out price was 359K and an appraisal 3 months earlier was 362K.

We were lucky they were intelligent enough to pooh pooh Zillow. Such a waste.

Jan 20, 2008 07:09 AM #2
Rainmaker
1,393,608
Maureen McCabe
HER Realtors - Columbus, OH
Columbus Ohio Real Estate

Lenn There is not much of a market for homes over 5 million dollars in Central Ohio. There are two homes on the market above 5 million. Solds in the four to five million dollar range are non existant in resales (but Erick says the homes are surrounded by homes selling in that price rainge... new builds??)

I am not saying Zillow Zestimates aren't flawed, I'm saying don't make me defend those Zillow values by telling an unbelievable tale on the internet of homes selling (should be liisted) for 8.5 - 9 million dollars Zestimated at 1.5 million. The Zestimates are based on the tax values, everyone has access to the tax values here... we are always all over the board on whether homes sell anywhere near appraised values.

Zillow has the publics eye. When Real Living partnered with Zillow for a very short time in 2006 and used the Zestimates Joel Burslem of Future of Real Estate Marketing wrote a blog about how brilliant it was despite the flawed Zestimates. I'm also not saying that the listing agent and sellers are incorrect on how they have the homes priced, just that there is not much of a market for homes over 5 million dollars in Central Ohio. Reading the comments on TechCrunch I thougth do we have homes priced in the 8.5 to 9 million dollar price range? We do. One.

I'm saying it makes a great story to say a home priced at 8.5 to 9 million dollar home is valued at 1.5 million. I am sure sellers don't like having the home they believe is worth 8 million dollars showing on Zillow worth as worth under five million... but it's better than being shown on Zillow as worth 1.5 million, or maybe not. Maybe that would be easier to poo poo.. because it would not match the auditor's appraised value.

They're not Real Living HER listings. One shows up as for sale on Zillow, the other does not. I wonder who claimed the one that shows up for sale... I don't understand how that works. I have been trying to ignore Zillow for the past year.

Jan 20, 2008 07:14 AM #3
Rainmaker
1,393,608
Maureen McCabe
HER Realtors - Columbus, OH
Columbus Ohio Real Estate

Jay thanks for the comment.  I did a bunch of posts on Discover Columbus (back when it was called Columbus Best Blog) about Zillow Zestimates being way off... I am not defending their Zestimates.

Does your company put listings on Zillow?  Or have you put your listings on Zillow?  I did not... some RL HER agents did. 

I got a comment from the President of Real Living when I blogged about Zillow and Real Living. Change.  The business is changing.  It does not matter if the values are flawed, consumers like Zillow.  Infotainment.

Trulia had more traffic in December than Zillow though.  There's a chart in the TechCrunch post that the comment is from.  

 

Jan 20, 2008 07:24 AM #4
Ambassador
896,685
Missy Caulk
Missy Caulk TEAM - Ann Arbor, MI
Realtor - Ann Arbor Real Estate
I'll be nice and keep quiet.
Jan 20, 2008 07:32 AM #5
Rainmaker
1,393,608
Maureen McCabe
HER Realtors - Columbus, OH
Columbus Ohio Real Estate

 

Not a Zillow fan Missy? You can say that... or not.

Jan 20, 2008 07:40 AM #6
Rainmaker
239,207
Gene Allen
Resh Realty Group - Virginia Beach, VA
Realtor Hampton Roads Real Estate
Fortunately Zillow seems to be a non starter in our area.  My thoughts on it are they are trying to put us out of business.  I know I have heard that we need to change our business model but so many companies are built on the full commission that many will fail and many people will be out of business.  How many times do you walk in a big box store and wish for an employee to help you that had some clue what you were talking about.  Real estate is heading that way.
Jan 20, 2008 02:52 PM #7
Rainmaker
1,393,608
Maureen McCabe
HER Realtors - Columbus, OH
Columbus Ohio Real Estate

Disintermediation?  That was the story before Zillow was launched.  Thanks for the comment Gene. If you read the comments on the tech blog (TechCrunch link in the post) not all are bullish on the success of Zillow's business model.  There are one or two comments that puzzle me... but I have a hard time with whose perspective some of the comments are from, consumers?  tech people?  RE agents.  hmmmm Zillow as the big box store????

Jan 20, 2008 03:12 PM #8
Rainmaker
226,221
Jonathan Benya
Keller Williams Select Realtors - Waldorf, MD
MD Short Sale Specialist
OOHH, Zillow.  Like it or not, people are fascinated by them.  I can only hope it's a passing fancy.  They're certainly not doing anyone any favors here.
Jan 21, 2008 09:51 AM #9
Rainmaker
1,393,608
Maureen McCabe
HER Realtors - Columbus, OH
Columbus Ohio Real Estate
Thanks Jonathan! That's infotainment!
Jan 21, 2008 10:49 AM #10
Rainer
35,063
Jim Hirschhorn
Real Living Real Estate Solutions - Orlando, FL
GRI, Real Living - Orlando
Ok, we all basically agree that their prices are, shall we say, off a bit. BUT, if the goal is to drive people to your website...they have accomplished this. They were one of the first ones to use satellite imagry for people to see the house they grew up in from the sky. We know that 80% + of the customers start their search online. Hopefully, customers are understanding that this is a guideline. Sometimes they are right on and sometimes they are way off. If a customer looks at their house on Zillow and sees that it is way off, then they will know to seek another source...hopefully a Realtor.
Jan 22, 2008 12:07 PM #11
Rainmaker
1,393,608
Maureen McCabe
HER Realtors - Columbus, OH
Columbus Ohio Real Estate
oh my gosh I am off to see the house I grew up in from the sky... why didn't I think of that.  Thanks Jim!
Jan 22, 2008 12:22 PM #12
Rainer
35,063
Jim Hirschhorn
Real Living Real Estate Solutions - Orlando, FL
GRI, Real Living - Orlando
Maureen, nostalgia is great! I know many people who swear that they can see themselves in their driveways on satellite!
Jan 22, 2008 12:37 PM #13
Rainer
127,860
Stefan Scholl
Buyer's Broker of Northern Michigan, LLC - Petoskey, MI
Northern Michigan Real Estate
Maureen, As far as I can tell, consumers really like Zillow. I think those in the industry that hate/attack/despise Zillow do so at their own risk.
Jan 30, 2008 10:53 AM #14
Rainmaker
1,393,608
Maureen McCabe
HER Realtors - Columbus, OH
Columbus Ohio Real Estate

go play on the Zillow forums Stefan.  ;- )  speaking of anonymous comments (you were on my other post....)


I think most consumers do enjoy Zillow, it is infotainment.  Sunday when a client mentioned Trulia.com I asked him what he thought of Zillow.  He did not know Zillow... he is a buyer.  He is very tech savy, he found me via my blogs.  I have always thought  Zillow was more widely known.  Maybe that is just with sellers.  He will know his Zestimate once he owns?  

"those in the industry that hate/attack/despise Zillow do so at their own risk." consumers care whether you pledge allegiance to Zillow? 

 

 

 

Jan 30, 2008 11:08 AM #15
Anonymous
Anonymous
Donna L. Hoffman
In my opinion, the Zillow Zestimates are seriously flawed.  Since Zillow doesn't reveal the algorithm for open scrutiny, we can't evaluate where the flaws are kicking in.  That, in itself, is cause for concern.

We've been following this over at the UCR Sloan Center for Internet Retailing, and so far, Zillow doesn't have a very good answer to the discrepancies.

See for yourself: http://sloan.ucr.edu/2008/03/09/why-are-zillow-zestimates-so-wrong/

Professor Donna L. Hoffman
UCR Sloan Center for Internet Retailing
Mar 17, 2008 10:47 PM #16
Rainmaker
1,393,608
Maureen McCabe
HER Realtors - Columbus, OH
Columbus Ohio Real Estate

 

Thanks Donna.  Oooooooooooooooooooh I see a new Zillow post coming on...

Mar 18, 2008 03:44 AM #17
Rainer
16,938
Nick Ruta
Whitehall, PA
That's as bad as the "32 Bedroom" $180,000 ranch house I stumbled across recently on Zillow.
Mar 18, 2008 12:46 PM #18
Rainer
66,937
Rob Muller
ReMax Town & Country - Canton, GA
Cherokee County Real Estate
I have heard this same story over and over again, yet still people wil believe anything the internet tells them
Mar 18, 2008 10:55 PM #19
Rainmaker
1,393,608
Maureen McCabe
HER Realtors - Columbus, OH
Columbus Ohio Real Estate

Nick some people are playing games on Zillow. Otherwise the auditor would also have a 32 bedroom house wouldn't it?  Coldwelll Banker Heritage? Dayton? I will have to click and see... 

Rob... Odd comment. Not sure I believe that is true of all people. Or has much of anything to do with this post. This post is about a fella questioning what the internet  tells him and the world about the value of a property. I  am not sure there are a lot of people who believe the Zillow zestimates. That like the values are all over the board. 

Mar 19, 2008 04:36 AM #20
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