This article was pulled from Zillow.com. Many homeowners go to Zillow to see what their home might be worth just out of curiosity or to begin the process of getting ready to sell their home. It is very important to contact a realtor to see what your home may actually be worth. Zillow is not your best source for pricing your home but it is a tool worth checking out. You can contact a Blass Team member to help you with any of your real estate needs. We have many homes for sale in Tucson and surrounding areas that we’d like to share with you. Just give us a call!
For Tucson homes for sale go to www.BLASSHOMES.com, and for all your Tucson Real Estate needs!
So, what is a Zestimate?
The Zestimate (pronounced ZEST-ti-met, rhymes with estimate) home valuation is Zillow’s estimated market value, computed using a proprietary formula. It is not an appraisal. It is a starting point in determining a home’s value. The Zestimate is pulled from data; your real estate agent or appraiser physically inspects the home and takes special features, location, and market conditions into account. Variations in price also occur because of negotiating factors, closing costs, and timing of closing. We encourage buyers, sellers, and homeowners to supplement Zillow’s information by doing other research such as:
* Getting a Comparative Market Analysis (CMA) from a real estate agent
* Getting an appraisal from a professional appraiser
* Visiting the house (whenever possible)
* Creating your own estimate using the My Estimator home valuation tool
What’s the Value Range?
The Value Range, which is related to the Zestimate, shows the high and low values of a home (e.g., Zestimate is $260,503; Value Range is $226,638-$307,394). The Value Range can vary in magnitude depending on our historical ability to estimate similar homes. A bigger range indicates less data or more volatility in the data. A smaller value range means we have lots of information to help compute the Zestimate and Value Range.
My Zestimate is too low – or too high. What gives?
As we said, the Zestimate is a starting point in figuring out the true value of a house. For one thing, the amount of data we have affects the Zestimate accuracy. If your home facts are incorrect, you can update your facts, which may affect your Zestimate value. Also, we’ve never been to your house, never seen your expertise with colors and landscaping. So we’ve given you a way to consider them (and other things) in calculating a home’s value. Use the My Estimator tool to create your own estimate. If you are estimating your own house, you can even make your estimate public, which is extremely valuable if you’re posting your home for sale.
How does the amount of data affect it?
For example, the number of transactions in a geographic area affects how much we know about prevailing market values of homes there. The more transactions, the more data and the more accurate the Zestimate will be. Also, we use public data for house attributes, and some areas report more data than others. The more attributes we know about homes in an area (including yours), the better the Zestimate. Remember that homeowners can also update their home facts if they feel they are incorrect, and they may affect the Zestimate value.
Is a Zestimate an appraisal?
No. The Zestimate is not an appraisal and you won’t be able to use it in place of an appraisal, though you can certainly share it with real estate professionals. It is a computer-generated estimate of the worth of a house today, given the available data. Zillow.com does not offer the Zestimate as the basis of any specific real-estate-related financial transaction. Our data sources may be incomplete or incorrect; also, we have not physically inspected a specific home. Remember, the Zestimate is a starting point and does not consider all the market intricacies that can determine the actual price a house will sell for, such as entertaining offers, negotiating, closing costs, timing, etc.
How do we come up with the Zestimate?
We compute this figure by taking zillions of data points – much of this data is public – and entering them into a formula. This formula is built using what our statisticians call “a proprietary algorithm” – big words for “secret formula.” Currently, we calculate a Zestimate for more than 70 million homes and have data on 20 million more.
What’s in this formula?
One eye of newt … Actually, it’s less wizardry than mathematics. When our statisticians developed the model to determine home values, they explored how homes in certain areas were similar (i.e., number of bedrooms and baths, and a myriad of other details) and then looked at the relationships between actual sale prices and those home details. These relationships form a pattern, and they used that pattern to develop a model to estimate a market value for a home.
Is that all there is to it?
That’s oversimplifying something that is incredibly robust and sophisticated, but it’s the basics. Hundreds of home details feed into the formula and the home characteristics are given different weights according to their influence in a given geography and over a specific period of time. And, because the details are always changing, the Zestimate is extremely timely – it indicates the value of a home based on the most recent data available in an area. We receive new data and update the Zestimate regularly to capture new sales in a neighborhood. However, there is a delay between when the county is notified of a transaction and when we find out about it. We might not know for some time about the sale of that house down the street from you that happened last week.
Why do I see home values for the past?
We not only have Zestimates for homes now, we have used massive computing cycles to go back in time to generate historic Zestimates as well. Sound hard? It is, but it’s critical because it allows you to see how a home (or an area) has appreciated in value over the years. You can see a home’s appreciation in a chart that looks just like a stock table. Your home is, after all, a major asset in your overall portfolio.
How accurate is the Zestimate overall?
Our accuracy depends on the home data we receive; see our Data Coverage and Zestimate Accuracy table to see how accurate we are in your area. (You can refine the Zestimate using the “My Estimator” tool, adding things you may know about but we don’t, such as remodeling information.) When it comes to unique homes (e.g., luxury mansions, unusual designs) we are less accurate in our Zestimates.
Who calculates the Zestimate and how do they do it?
We don’t have homing pigeons flying from land parcel to land parcel to come up with the Zestimate for a house, but we DO have statisticians who work all day – and some nights – with a huge amount of data. They live and breathe valuation models and tweak algorithms to get us closer to actual market value.
But you don’t know about my granite kitchen counter and my river view!
It’s true, we’ve never been to your house, never seen your expertise with colors and landscaping. Only you know those things. So we’ve given you a way to consider them in calculating a home’s value with the My Estimator tool. Enter an address for any home, then click on “Create an estimate.” My Estimator will walk you through the steps to adjust your valuation.
Can I use the Zestimate to get a loan?
No, you can’t. To get a federally guaranteed loan, a law called FIRREA (the Federal Institutions Reform, Recovery and Enforcement Act) requires an appraisal from a professional appraiser. The Zestimate is our estimate of fair market value, a starting point for home buyers and sellers and anyone just plain interested in the value of houses. You can use it in negotiating, in judging market trends, and in calculating all sorts of things for your personal purposes. But, if you needed a loan or help in understanding the ins and outs of financing, please visit our section on investing.
Where does all the information come from? How can you know all this stuff?
It all comes from public data. The data is public because it’s a consumer’s right to have access to information about what is to be their most important investment – their homes. What? You’ve never seen it? That’s because it is hard to find and hidden in multiple sources. Zillow has done the legwork for you by getting huge amounts of data from many sources and creating something unique that the public sources don’t provide – a Zestimate of your home based on the public data.
Don’t forget to visit www.blasshomes.com for your Tucson Real Estate needs!
