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The Whimsical Zestimate Gone Awry

I had a good laugh recently when reading Kris Berg’s San Diego real estate blog as she discussed “Zestimates”. “Zestimates” are generated on the web site Zillow.com which has become one of the top-tier real estate web sites in the country. Zillow.com basically takes the MLS data, and then creates an exciting set of graphs and charts that people are eager to consult, plus they have relevant advertising targeted to their demographic.

The “Zestimate” is an estimate of a home’s value using tax record data, mixes it with recent comparable public sales data and a little special sauce to give consumers an accurate price target for each property, even those not currently for sale. It is not an appraisal, but a guide using a new-age Value Range approach.

Great charts and walk-ability scores

Honestly, the site is very impressive with charts, links to additional sites, a satellite picture, and the “Zestimate” like I have discussed before. It is also so entrenched that “Zestimates” even show up on consumer trusted sites like Redfin.com or local newspaper real estate reports as a trusted source.

Darn it, if they trust them then it’s gotta be accurate. Finally the home buying consumer has real transparency when making decisions.

But what happens when the “Zestimate” is wrong? I sometimes contribute to Zillow.com to answer consumer questions, free, and the most common question that I see is “the Zestimate on my house is wrong. How do I change it?” So far, I have stuck up for the site citing the old “garbage-in, garage-out” saying and that, through time, the figures will become more accurate and not have Median Error rates of 13%.

I do my listing agent homework too, and when I went to check on a Fairfax, VA home for sale recently, the “Zestimate” came back at a price $488,000 below the asking price.

Say what?

When I went to the little map box on the Zillow.com listing and actually clicked on the property, then a brand new “Zestimate” popped up using the Value-Range pricing method with a price of $824,000 (which is low, but more like it) for the property. And you will need to click on the “Bird’s-Eye view” to actually see the property that is being offered for sale.

My conclusion is that Zillow.com has paired up the wrong tax record (their annual tax figure was incorrect) and, as a result, their top-line “Zestimate” is completely wrong.

Really, it’s free marketing so I’ll take it!

Am I complaining? No, because I want this home to be seen by anyone who is in the Fairfax, VA real estate market (a good thing) and I am spending time examining how my listing is being marketed because I know that today’s consumer pays attention to sites like Zillow.com, Trulia.com or any of the other sites that cross promote each other’s facts, figures and “Zestimates”.

As a full-time, boots on the ground real estate professional looking out for his client, I am willing to drill-down and see where information becomes murky for consumers who click through in 0.0375 Google-seconds if they don’t like a home listed on a web site.

Ultimately, when this property sells then there will be a new public record for Zillow to index and hopefully the record will be set straight once and for all.

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A secret buyer agent search strategy for a home in Vienna, Virginia

Yes, another buyer agent secret search strategy for a lucky client living in Vienna, Virginia

When I meet with buyer clients, I like to discuss how our home search is going to involve a multi-pronged effort in order to be successful. The client will use the resources of the Internet with sites like Homesdatabase.com,  Realtor.com, Trulia or Zillow, and a few other super secret strategies. Yes, I will have the MRIS/MLS along with a network of successful agents that I have cultivated over the years and a few clever old school ideas.

But a few weeks ago when some clients were being extra specific, I drilled down through the Fairfax County tax records to look for old-timers who may be getting ready to move. You know, the old “come on lady, move out now while you can still walk” strong-arm strategy, similar to the training tape we just watched last week featuring Alec Baldwin.

But seriously, I found some folks who had been in their home 20+ years and sent them a compelling letter with followed up phone calls. As fate would have it, one guy who was just starting the pre-listing process and received a letter called his agent asking if my letter “was for real”.

“Who is it from?” she asked.

“Some guy named Doug Francis with Remax real estate” he responded.

“Well, I have known Doug for 17 years, so I feel it’s legit” she said.

So we saw the house, made an offer that was accepted, and now just have to wait for the appraisal to get finished. A successful home search, even in Vienna, Virginia, needs more than one strategy to get the job done.

Old school!

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Power lines, law, human nature and real estate

An interesting aspect of being a real estate agent is that you get to learn about a variety of subjects such as law, environmental issues, construction, mortgage finance, human behavior, negotiation techniques, legislation, and much more. And the successful agents know that having a team or network of professionals is important to providing the level of service that consumers expect.

I answer questions on the Trulia.com site and responded to one today regarding electrical sub-stations and if there were health risks. It was interesting that no one else dared answer this one but I gave an answer that included a link to the Health Physics Association that examines radiation safety. And the effort was appreciated by the person who asked the question.

Having shown dozens of homes over the years near power lines and sub-stations, I gave my own personal observation based on Doug Science, not found using “The Google”.

Sub-stations hum 24 hours a day, and I like to open my windows so that humming would drive me crazy! Can you imagine coming home every day thinking this over and over again? I can’t either so I suggested that he move on to another location.

Consumers often over think issues and can become obsessed that everything must have a logical answer. The Washington Post had an article yesterday about a couple who has spent three years analyzing home prices and made five low offers in that time (all rejected) and lovingly spend hours crunching the data all viewed on huge monitors. When they move into that perfect house at that outrageous price with FiOS and a garage, they will probably wake up one morning, open the curtains, and wonder if that electrical sub-station is a health risk.

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Home search sites are all over, but gimme some help…

There are MLS home search sites all over, but the new Homesdatabase.com looks really sharp and easy to use. And my blog adds more too. Should I just add this link to the blog? These are my thoughts on IDX too, as I try to decide to pay for IDX or link to the free site that my clients already seem to like?

I understand that finding the house is the easy part… it’s putting together the contract offer where my client’s really benefit. Yeah, more in the blog…

So why not compare… this site to this site and give me some feedback!

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• The Whimsical Zestimate Gone Awry (dougfrancis.com)
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• Home Inspection Reports Really Matter (dougfrancis.com)

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