For example, when there are more comparable homes on the market, the valuation models become more accurate with additional data. The fast pace of the current housing market has made estimating prices more difficult, Masters said. “There are some markets where the difference isn’t too drastic, in other cases, they can be wildly different.” “One reason why we think the three numbers are more insightful, is that it shows home sellers the picture is varied,” said Masters. But they are never a replacement for an experienced person who can see the property and understand the real nuances behind value.”Īnders Ibsen, an agent with Windermere Professional Partners in Tacoma, Washington The estimates help for an initial conversation. That’s one reason why offers three different estimates from the data companies it partners with, sources that are typically used by lenders and insurance companies. “No one has models that aren’t sophisticated, but the inputs can be very different.” “They can range widely, if you look at one address across many sites,” said Dave Masters, director of product management at. Here’s what you need to know about online real estate estimates and how to make the most of them in this market.Įach online real estate firm’s estimate is like its own special sauce with its own secret recipe.ĭoes it still make sense to put down 20% when buying a home? It is a more challenging environment to value a home.” “There is a wider range of outcomes for any sale. And individual estimates may be way over or under what a home actually lists and ultimately sells for.Ī rapidly appreciating housing market, where homes are selling within days, adds even more uncertainty, said Rao. While accuracy is improving, an estimate on one site can still be wildly different from another, sometimes varying by hundreds of thousands of dollars. Hundreds of factors go into the calculations for these estimates, he said, including local real estate databases, sale records over time, property records, tax records and other sources. “Even if they may have thought about selling a couple years ago, to look at where the market is now can be surprising.” “There is a kind of sticker shock that sellers may have right now,” said Krishna Rao, vice president of analytics at Zillow. While your home’s Zestimate may have you saucer-eyed, in fast-moving markets like this one it is harder to predict what your home will actually sell for. Is your Lamborghini too cold? Just ask Alexa to heat it up.
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