Eirinn if you are referring to Zillow and the like my home is zestimated on Zillow for about 240 my next door neighbor at 190 and a home down the street at 650 all are the same floor plan.
Garbage in garbage out they give themselves 3 stars out of 4 because they are within 20% of an accurate price 62% of the time. 38% of the time they are farther off than 20% their own statistics.


If I told a client that when I did a CMA the value was within 20% less than 2/3 of the time I would be shot!

Correct, typically these sites are not frequently updated and are out of date.

These estimates site are way off and only offer a broad overview of the market. You need much more detailed information to an accurate estimate of value.

Also not mentioned frequently in the online valuations are any seller concessions, bonuses or improvements made or buyer modifications that were added in to close the property. There's more than just the sale price involved. it could be conditions, contingencies, dates, special financing that also go into a sale that can be just as if not more important than the pirce alone.

Bank owned, short sales each have a unique story that also needs to be known for accurate comparison as well as the condition of the properties. Another part that online valuations have trouble taking into account is neighborhoods & borderline properties. They simply search by as the crow flies distance or by zip code, these methods can be ok for alot but they really don't address a property that's on the border of a nicer/lesser area and it's impact on value. This is the part where experience comes into play with your Realtor having been inside of & following the market conditions around the areas your interested in.
The online software has gotten better in recent years but still a far cry from actual eyeballs & feet in a property. It's biggest draw back is it's only as reliable as the data put in, and there's still alot of improvement to go whern it comes to the imput data & standards.

Most of the estimates on some ot the bigger sites are inaccurate because they are based heavily on public records and the comps they use are more than 3 months old and often times not even in the same city/town as the subject property.
As a Buyer in Massachusetts, it has become very difficult to over pay for a home since the appraisal rules have changed. A good number of deals have had problems with the appraisal coming in high enough for the buyer to get financing.
When looking for comps you need to base your estimate heavily on Sold properties within the last 3 months and no more than 3 miles away from the subject house. You need to make sure that you are only using short sale properties if the subject house is a short sale house. You can use under agreement properties if you are finding it hard to get enough sold properties.
I hope this helps--Mike

Eirinn,

It really depends what website you are using, and your general area. Nothing online will ever compare to a REALTORs CMA which looks at things like condition, extras, and so on. Websites like Zillow use such a broad range of information, for example, we built our house in an area that hadn't been built in for many years. Several hundred thousand dollars later, Zillow shows its worth not even 1/4 what we have into it. Now if you are in a subdivision, and the houses are comparable, and there have been recent closings, those websites are probably remotely accurate.

Good Luck!

There is more to comps than what you are close to. There are some neighborhoods around us that are split between two towns and the price difference for a house down the street and in a different school district is big. You have some neighborhoods that are tucked away down streets with cul de sacs and hard to get to via a main street. In some instances, this hurts, in others, the lack of traffic and lower pedestrian rates can add 50% to a house two or three blocks over. Some homes are two streets closer to apartments and that may give an over 10% loss of value - so many variables. If you doubt your agents reasoning, then sit down and have them explain what comps they use and why.

It depends on where you are obtaining these home prices. Websites such as Zillow use priority algorhythms to come up with values, and these have improved in accuracy, while still lacking in some ways. Interpreting comps is an art, and your agent should have a better handle on values than what numbers are arrived at from algorhythimic formulas. Also realize that each neighborhood has unique pockets within it and that cannot be factored in by a formula, but must instead have a person experienced and knowlegeable about the idiosyncracies of a particular area and the homes therein to compute an accurate value.

It depends on the data you're using and from where you obtained it.

If you're simply trying to use Zillow's z-estimate, then your agent is correct. If you're getting recent, sold comps for similar properties within a 1-mile radius of the target property, then tnat value is probably pretty accurate.