Online Home Values: Friend or Foe?
Online home valuation tools may be interesting, but if you are after the true value of your home, they are unreliable.
Are online home values reliable? Chances are you have at least heard of such sites as Zillow, Realtor.com, and Redfin. These real estate websites will now give you an estimate of your home’s value. Zillow in particular was a pioneer when they began their online valuation too, the Zestimate, several years ago.
The big question is: How are these online home values calculated? Can you trust the value that you get?
Well, in truth, if you go to five different websites, you will get five different values. One might say that your home is worth $900,000, while another might value your home at $1.1 million. You don’t want to rely on an online home value to decide whether you will make $200,000 more or less than you should when selling your house.
The reason these estimates are so far off is that they are simply based on statistical data, meaning that they’re looking at public records to determine the features of your home. If your home is a 3-bedroom, 2-bath home with 2,000 square feet, it will, according to the Zestimate or a similar online valuation tool, give a value similar any home with those qualities. It will not factor in things such as the view or any remodeling that you’ve done.
While online values may be fun and interesting to look at, they are not reliable at all.
If you want to know your home's true value, my suggestion to you is to speak to a professional Realtor. They will look at the characteristics that are driving what buyers are determining to be the value of your home in today’s market. While online values may be fun and interesting to look at, they are not reliable at all.
If you have any questions, please feel free to reach out to us. I would be happy to help in any way that we can.