When we saw the news that Spencer Rascoff, the CEO of Zillow, sold his home in Seattle for $650,000 under its Zestimate, we decided to do some digging and test out the most reputable online pricing estimate sites.
Spencer Rascoff's home sold for $1.05M and was estimated by Zillow to be worth $1.575M (via Zillow.com).
In order to test them, we first ran our standard pricing analysis for a home that we were familiar with. We looked to recent sales comps (three identical models that sold for $779,100 and $770,000 and $752,500) and then looked at the active listings comps (three identical models listed for $869,000, $869,00 and $819,000).
Sold: $779,100 Sold: $770,000 Sold: $752,500
Sold: $869,000 Sold: $869,000 Sold: $819,000
After obtaining pricing, we figured we would see online estimates between $750K and $870K. However, given the disclosures regarding pricing accuracy, we should have known what we were in for.
So, how did the online estimates turn out? 8 of 9 weren't even close. Some were up to 30% (over $200K!) less than what we were expecting.
Want our advice? The next time you are looking to value a property, find a local expert. Even Zillow's CEO will tell you that there is no substitute for seeking guidance from the pros.
If you're thinking of selling, don't let Zillow's price estimates give a buyer the upper hand - contact us to find out how you can improve the accuracy of your "Zestimate" in under 15 minutes.
You can also learn more about how to increase your Zestimate, here.