Zillow zestimates are most reliable when you are ltrying to determine market values in a very conforming neighborhood such as track subdivisions or condomiminium complex. IZestimates are extremely unreliable in non conforming neighborhoods with a lot of custom homes or along the coasts of the US where values can vary dramatically depending on precise location and view. These qualitative factors are very difficult to quantify in a zestimate.

No..don't use these numbers...get a Realtor who can use their knowledge about your specific home in specific neighbourhood to give you real numbers.

Currently it is running about 15% HIGHER than comps-Santa Clara County, CA. The algorithm seems to have changed lately.

The truth is the comps. While the sf gla is the driving mechanism. The br also plays a role for fair arm length transaction. One just can not compare a 3 BR vs a 2BR for same sf and call it a legit comp.

The sellers also have way too much attachment on the improvements made. A 100K up grade on a kitchen when it is completed it does not carry 100K more. Can you image what the car dealer says about your 6K upgrade on stereo system after driving off the parking lot?
Zillow or any model does not factor in the interior. Rather it is comparing neighborhood home prices and as long as they are all track homes. They seem to indicate a value.

Hi Getmehome, there are two words that I see on Trulia that frustrate me the most: RealtyTrac with their misleading feeds to Trulia, and Zillow!

In my opinion, Zillow is simply an Automated Valuation Method (AVM) website. Accuracy varies WIDELY by County. Here's sampling of Zillow's Median Error for the following Bay Area/coastal counties:

Alameda - 8.8% Contra Costa - 9.5% Marin-14.1% Monterey-16.7% San Francisco-10.1% San Mateo-8.2% Santa Clara-7.6% Santa Cruz-14.2%

This data above is from September 2008! Now, wouldn't you have updated this year-old information if in fact your system had improved its estimating capability?

I believe what the data shows is that estimating a home's value based solely on numbers does not work because it completely discounts the qualitative aspects of a home, and that's a huge mistake because while price is important in buying a home we all know location, amenities, look and feel play a large role in determining market value as well.

If you are serious about accurate valuations you must be working with a licensed Realtor, or even better, an Appraiser.

A Realtor can prepare a Comparative Market Analysis, which other than an actual appraisal, is the "gold standard" for approximating market value - period. A Comparative Market Analysis (CMA) gives you the best representation of market price/activity/trend direction - for the specific property details you search on. Just because a property sells right next door to another does not mean that it's a comparative match. DO NOT rely on median-based statistics, these measures are meaningless for targeted selling/purchasing as they have no regard for any of the specifics you may be comparing and can be skewed by segments of market activity not matching your individual situation. A “median” is defined as “the number separating the higher half of a sample from the lower half.”

For example, we know the sub-$500K market has been heating up for most of this year. Let’s say three homes sell in a neighborhood for $400K, $425, and $575K in one month. The first two may be neglected REOs, and the third has been maintained beautifully. The current monthly median value for this neighborhood becomes $425K.

A buyer/seller should look specifically at the targeted segment of properties that match their search criteria for the information to be meaningful. Generalized stats are easier to come by, but that doesn’t mean they should be used to make one of the most important financial decisions of your life.

Zillow describes their Zesstimate as a "starting point." While I applaud their efforts to inform the public, quite frankly, for those that seek accuracy Zillow is a point I would completely avoid.

Best, Steve

The Zestimate for my house was $265k, my lender's appraiser had it at $230k. I bought it for $220k. As soon as Zillow showed me purchasing it, my Zestimate went down almost $45k to $220.5k. :( None of the Zestimates of the houses around me changed though. That had me scratching my head.

Check out the video explaining how they arrive at their value.

http://talktocj.com/understanding-zillows-zestimates-and-hom…

CJ