The Fortune Magazine aricle on Zillow.com published in the February 7, 2007 issue, completely ignores the fact that you simply can not estimate a property’s market value given the limited public information available, such as the age of the home, location, number of bedrooms or bathrooms, or square footage. Many factors such as whether it has been remodeled, the desirability of the floor plan, proximity to schools, street appeal, etc. have a huge impact on market value. Only an experienced real estate agent or appraiser, taking all factors into consideration, can provide a property owner with an accurate estimate of a property’s value. I have seen many instances where Zillow.com’s valuations are 50% or more inaccurate, with many of their valuations appearing to be almost random.For instance, Zillow.com values the home across the street from me at a price approx. 40% less than my home, although it has approx. 22% less square footage, one less bedroom, a less desirable floor plan, a smaller yard, and no ocean view, which my home has, and although recently remodeled, my home has also been remodeled with a much larger new kitchen. Zillow.com also has another home across the street from mine at a valuation at least 40% lower than its true market value, because zillow.com completely ignores the fact that it was recently completely remodeled inside and enlarged.
The business model of zillow.com simply can not provide accurate market value information, as the public information which it uses tends to lag the market, and most importantly, they are completely ignorant as to the unique qualities and details of each home that it appraises. Has it been remodeled? Does the floorplan work well? Are the bedrooms too small? Are the bathrooms and kitchen well designed? How large is the backyard and is it nicely landscaped? Does the house enjoy good curb appeal and attractive and well maintained landscaping? How well maintained is the home, and does it have any issues such as mold, old roof, or other deferred maintenance? All of these factors are important to evaluate in determining a property’s market value, and zillow.com simply can not do so. Only an experienced real estate agent or appraiser, taking into consideration all of a property’s unique characteristics can help a client estimate a property’s true market value. Anyone using zillow.com as fact, may as well be using a Ouija board. Another good web blog that discusses this issue about how Zillow.com is a fraud is http://www.bloodhoundrealty.com/BloodhoundBlog/?p=134