Ok, so if you’ve ever used Zillow, you know that it’s a fun toy to see how much your neighbor/boss/co-worker/doppelganger’s house is worth. Is it completely reliable? Let’s just say, it’s a starting point
Case in point. I was curious what Zillow thought the average $ per square foot was in Mt. Carmel. I first did it by myself, using comps of recent sales in the area, in the last couple quarters — typically how we realtors would arrive at a value in order to assess what a home might be listed at. Give or take a few bucks, in Mt. Carmel, that amount is currently $611.
Now, looking at Zillow, their estimate is $633. Not too bad, but I’m not surprised, given that I’ve seen Zillow be completely off base around 10% either way, many times. What’s perplexing is that their algorithm to get their value can sometimes use recently sold houses that have absolutely no business being part of the computation.
Here’s an example: I looked at the Zestimate (Zillow’s branded estimate) of a Mt. Carmel home, and here’s just a sampling of the comps they used:
- 1924 St. Francis, San Carlos
- 2415 Eaton, San Carlos
- 1505 Chestnut, San Carlos
- 913 Pleasant Hill, Redwood City (in Emerald Hills area)
- 1868 Lenolt, Redwood City (east of El Camino)
13 out of 50 of the comps they used were in San Carlos. Mt. Carmel isn’t even on the border of San Carlos (like say, Edgewood Park), so to me, it’s not very smart to estimate a home’s value by using these as comps.
Yes, Zillow can be an interesting, useful, sometimes voyeuristic tool, but take this example above to set your proper expectations.