The big questions for today are: What is a Zestimate, how accurate is it, and how can you make sure that it’s not costing you money?
What is a Zestimate? Well, the Zestimate is just an automated valuation model that’s derived from an algorithm that incorporates basic, public information about your home and other homes in the area to come up with an estimated value.
Is the Zestimate accurate? Well, Zillow’s own website admits that the Zestimate can be anywhere from 10% to 20% off the market value of a home. It really only is meant to be a starting point.
What affects the value of a Zestimate? The algorithm used to value a home is based on the specifics of your home, like your bed and bath count, the market trends in your area, or how much the aggregate value of your zip code has increased; and it also looks at recent or past sales. If you’ve sold your home recently for below market value, your home’s Zestimate will be a little undervalued until a certain amount of time has passed.
Because Zillow only uses basic information to calculate your Zestimate, there are certain things that the website can’t factor in, such as:
- Your home’s upgrades
- Distinct features of your home, like views, etc.
- Any additions you’ve made to the property
If you’re a homeowner, here’s what I suggest you do in order to insulate yourself:
Find your Zestimate online and claim your home. Zillow does allow you to audit the specifications of your home and add in certain features the site will have missed. However, the most important thing to do is to make sure your bed/bath count and your square footage of both your home and your lot are recorded accurately. At least then you’ll know that you’ll get Zillow’s best estimate.
If you want a more accurate estimate of your home’s value, I strongly advise you to enlist the help of a local Realtor to do a broker price opinion, or else to hire an appraiser.
In that case, give the Brett Jennings Group a call. We can do a free assessment of your property, and while we’re there, we can also give you some tips and ideas on what you can do to increase the value of your home with some simple upgrades and fix-ups before you bring it to market.
If you’d like more details on increasing your home’s value, check out one of our other video blogs called “5 Tips to Boost Your Home’s Value.” It is one of our most popular blogs. We hope to hear from you soon!