Skip to main content
  1. Home
  2. Hacks & How-to's

Why you shouldn’t trust Zillow’s home valuation estimator

Amelia Wilson
By

Zillow has become a fast-growing favorite for many prospective homeowners. The site boasts thousands of homes in several locations with data and statistics to make a smooth home selling and buying process for many individuals.

One of Zillow’s notable features is its Zestimate tool — Zillow’s estimate of a home’s market value. As the market fluctuates, many people have looked to the Zestimate to find the valuation of homes. Unfortunately, this tool isn’t entirely accurate. We asked a real estate expert to weigh in on this topic to resolve our concerns about Zestimate.

Recommended Videos

What is Zestimate?

Zestimate is Zillow’s well-known home valuation estimator. The tool is meant to provide prospective buyers with an estimation of what the home may be worth, and the goal is to create transparency in the market that encourages sellers to set fair prices. The estimator also highlights how the home’s property value may increase in the coming years, as well as estimated payments buyers can expect to pay once all documentation is signed and the house is transferred over to them.

real estate agent talking to homeowners
BalanceFormCreative/Shutterstock

How are homes evaluated?

Homes are evaluated on three core aspects. With this data, Zillow’s Zestimate creates an estimation of how much the home might be worth.

Related

Home features

First, the algorithm looks at the home’s features. Things like square footage, location, lot size, number of bedrooms, and other amenities are assessed and considered for the final value.

Market data

Market data is also taken into account. Depending on other properties in the area, list pricing and days on the market will affect the home’s overall value.

Taxes and prior sales

There are several other factors not listed on the market that also need to be considered. This data will include tax assessment and prior sales to determine the best value for the home.

What real estate experts say

Unfortunately, Zillow’s Zestimate tool has room for error, and Zillow acknowledges that their estimator isn’t always accurate. After all, the Zestimator can only make a guess based on the data given. The more data available on a home, the more precise the Zestimate is liable to be.

We spoke to leading Naples real estate agent, Dennis Bowers of The Bowers Group, to get a professional opinion on Zestimate.

Bowers explained that Zestimate has many inaccuracies since “the data pulled to calculate the Zestimate is computer generated.” He further elaborated that “the system does not take into account current market conditions and market demands,” such as the effects of the pandemic on communities and the limited inventory available for buyers.

“Renovations, upgrades, and interior finishes all play a factor in the home’s value. A home with a new roof, new hurricane impact windows and doors, and new appliances or designer finishes is going to sell for more than one without. Zestimates don’t have access to this kind of information, thus it is not factored in.”

Since the Zestimate tool doesn’t factor in this vital information, it’s important to speak with your realtor about your home’s estimated value. While homeowners can input this data on Zillow, cross-referencing with a professional can save you money in the long run and prevent any overlooked errors.

homeowners discussing home value with real estate agent
Mart Production/Pexels

What home valuation tools can you trust?

According to Bowers, the best home valuation tools will be real estate agents themselves. If you want a near-accurate estimate on a home you are interested in, it’s best to gather your real estate agent’s professional opinion.

When looking for the most accurate home value, you should consider the home’s features, market data, and overall market history. Ask your realtor for a complete breakdown of homes you’re interested in before you ever make your first offer.

Besides speaking to a live realtor, you might also consider trying online calculators from your local real estate company. While not every business has a tool to evaluate the prices of homes in your neighborhood, the digital age has urged many local realtors to provide online estimations if possible.

Getting the right value for your home shouldn’t be a stressful process, and it’s important to know what tools you can trust. It’s always best to reach out to an agent for an in-depth valuation of a home you are interested in. This will benefit you and your family in the long term and allow for a better approach to home value estimators.

Editors' Recommendations

Topics
Amelia Wilson
Amelia Wilson
Contributor
Amelia Wilson (author pen name Amelia J. Wilson) is a content writer in Greenwood, IN. She often enjoys topics on…
When you should (and shouldn’t) put used coffee grounds in your garden
Coffee grounds do have a place in your garden. Here's how to use them
Person holding coffee filter with coffee grounds.

Depending on how into gardening you are, you may be aware that putting used coffee grounds in your garden is a highly debated topic. Some people swear by using coffee grounds for growing plants, while others say it's the worst thing you can do for your garden.

So which opinion is correct, and how do you know which side to trust? How do you know if you should -- or shouldn’t -- put used coffee grounds in your garden? We’ve researched the pros and cons and broken them down below so you can decide if you want to use coffee grounds in the garden.

Read more
Cleaning 101: Why you should never mix bleach and vinegar
Here's why you should never combine these two products
All-purpose cleaner in amber bottle in bathroom

Cleaning is an essential part of maintaining a healthy and hygienic living environment. However, it's crucial to be aware of the potential dangers that can arise from mixing certain household cleaning agents. One such combination that should never be mixed is bleach and vinegar.

Let's explore the reasons why combining these two common household cleaners can be hazardous and discuss the precautions you should take to ensure your safety.

Read more
Gas dryers vs. electric dryers: Everything you need to know before you buy
Pros and cons of gas dryers and electric dryers
Small laundry room with washer and dryer and potted plants

If you own a home or condo, odds are you have a washer and dryer, but have you ever thought about the pros and cons of gas dryers vs. electric dryers? When you're in the market for a new dryer, you may feel forced to get the type of dryer your house is set up for. If you're building a house or have both hookups in your home, then you can choose which type you’d like.
Regardless of your current dryer situation, the differences between the two types are helpful to know. Which is cheaper to run? Which is easier to troubleshoot or work on yourself if repairs are necessary? Which one dries clothes faster? Here are the big differences between gas dryers vs. electric dryers so you can understand your system better or pick a new one that you prefer.

Similarities of gas dryers vs. electric dryers
Both electric and gas dryers have an inner coil that heats and uses a fan to move the heat around your wet clothes. All dryers have an internal drum that rotates and tumbles the clothes around. All dryers also require an electrical outlet because electricity runs the tumbler and fan regardless of the heat source. These are the similarities that all dryers share. Now, let's examine the major differences.

Read more