New Home Valuation Site Launches
The brainchild of the founder of travel site Expedia, Zillow.com finally launched today after months of speculation and hoopla.
The site runs on an algorithm using nothing more than publicly available data.
I ran a couple of searches and compared them with my reality (which includes MLS data and real-world experience), and it’s really not that accurate for properties in San Francisco. It will, however, provide a good way to see what some of your neighbor’s houses sold for (using only hard facts from the recorder’s office)…
For example, in one particular six-unit building, their ‘Zestimate’ (their term for the calculation results) ranged from $800k – $1.1M, and the units are all identical in size and quality. This resulted from different dates of the most recent sales in the building, leading me to believe that the model figures too much into an average-rate-of-return model and not enough on street-level knowledge that real estate agents provide.
I would encourage buyers and sellers to visit this site or any other site out there that will help them learn more about their city or neighborhood. Knowledge is power. Which is why I’m not concerned about any effect on my livelihood. Unless this algorithm has been in each of these properties and knows why they sold for as much or little as they did, it will only be partially effective.
Educated buyers and sellers make transactions more stable, as they will know more before entering into a contract. My clients, who are mostly younger and very tech savvy, have always done their due diligence prior to buying or selling, but I don’t think any of them would choose to do a transaction without the expertise of a REALTOR®.
Just my $0.02, of course, and only time will tell…
I tried the website. I actually like it. Its a powerful tool that helps people to understand more about their home and community.
Now more and more tools are available for average buyers/sellers to do the research themselves. It empowers the user with simple access to retrieve information. In a realtor’s point of view, customers are now more informed and educated in this field, the realtor must have the ability to generate more in-depth analysis and insights to help the customers make better decision. Otherwise, we will begin to see more and more uncompetitive realtors in exile.
Jeff Chuang / Prime Harvest Properties LLC at February 9th, 2006 at 5:50 am ( )I think this is [thankfully] the beginning of the end of Realtor, Inc. Who needs to pay 6% commission for information that comes free of charge? Now if they would only link this to http://www.forsalebyowner.com
Anonymous at February 15th, 2006 at 7:53 am ( )Ahhh… first it was the bubble prophets, now come the ‘end of the Realtor’ prophets… You can post all of the real estate data on the internet that you’d like, but it will never change the fact that a good agent provides an invaluable service.
The only people that are going to be out of a job because of Zillow are the other online companies that tried to do home valuation. Zillow put them out of business in one day.
But all of their information is still just based on public data, and not on anything that really makes the real estate agent’s job what it is: a personal experience, both before the transaction and during the transaction. Factual data is only a small part of the equation.
Go out and list your home as a FSBO, then call me when you don’t get the price you really wanted, or when you realize how much work we do to earn our commissions.
Matt Lanning at February 15th, 2006 at 8:16 am ( )