I just got an email from Zillow’s Director of Communications and she passed along the fact that not only is their blog live, but a beta version of their site is live as well… Rich and David flipped the switch!
So, what does Zillow do?
In two minutes of of a Skype conversation with my mom, we were able to find the “Zestimated” value of my home in Seattle, my mom’s home in Sacramento, and my grandmother’s home in Las Vegas… Very cool indeed, especially since my home value is zestimated to be worth $140K more than we paid for it two-and-half years ago!
From what I can tell, they’ve found a way to estimate the value of thousands upon thousands of homes (60,000,000+ homes by their count). For my neighborhood, they have lots of background information on each home… Not only does it tell you the size, square feet, lot size, etc. but it also gives information like a list of recently sold comparable homes. Very cool indeed.
The site is loaded with tables, graphs, and charts for each home.
Probably the strongest selling point so far is that creating a set of comparables is so easy. I’ve worked a fair amount with Anna to develop comparable market analysis, and I can tell you that agents may have access to slightly better data on each home, but Zillow’s system is SO much easier to use that I imagine many agents will turn to Zillow from now on…
Interesting, interesting stuff… It is interesting that the site has a complete lack of obtrusive ads and it will be really interesting to see how this plays out in the agent community. I’m not seeing a lot of negatives so far.
Here’s how Rich Barton explains their business model on the Zillow blog:
I’d like to make a comment on our business model, which I’ve found helps divine motives. Zillow.com will make revenues from advertisements on the site. We will always be crystal clear about what is content and what is advertising, just like any respectable content provider, and our advertising will not define our content. However, the beauty of “Web 2.0
ROTFLMAO!!!!
My home is valued on Zillow at over $200,000 LESS than I just paid for it!!
I may just have to put it up for sale and see what happens.
This is too funny. It had to be me…didn’t it?
As they used to say on Hill Street Blues…”Be Careful Out There!”
LOL
You are not alone, Ardell. The Zestimate for my current house is $446K. I paid $550K for it in May. And according my best guess, I suspect I could sell it for about $670K now. (Disclaimer – I am not trained a realtor, although I do attempt to emulate them in software from time to time :)). I hope the King County assessor uses Zillow when computing my property taxes this year.
What’s interesting, is that it says that the house I sold for $545K, is now worth $590K (which seems pretty accurate).
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Just viewed my parent’s house in Orange Country. Zillow was about $300K low. In this case, if they uses comps AND tax records to determine value, they would have undershot due to Prop 13. Pre-Prop 13 owner pay almost not taxes; post Prop 13 home owners pay a lot more. Therefore, if their engine scours tax records for this house (and many others), it will undervalue.
Definitely a cool tool, though, despite it being way off in many markets.
Dito on that Robbie… i’ll only owe Dekalb like 5 dollars!!
whoo hooo
There are already automated valuation companies who provide this service for the Mortgage Lending industry. Certain loan types such as Home Equity, often use these models in place of appraisals… only when there is a certain level of anticipated accuracy.
It is critical to note that this type of valuation is notoriously flawed. No one has discoverd a reliable statistical method to account for the variances. It is also important to note that an appraised value can often have a disparate relationship to actual sales price.
What Zillow provides is nothing really unique. HomeGain provides the same type of service.
All said, it still is a very nicely designed site. It will change how consumers perceive their ability to manage their own real estate. I can see how it will also create tension between real estate and finance professionals and their clients. Professionals will have to explain why zillow isn’t infallible and why their home may/may not be properly valued.
All, in all, they will have to settle for advertising revenue, because the actual service they provide is many years from being reliable. Personally I think their approach borders on irresponsible as there is very little context provided for the values and variances.
Hi MJB, my wife(a Real Estate Agent) shared with me the Zillow.com link. This is how I found this blog here. Anyway, she wanted my opinion, since I am a technology professional. So, I gave my rather lengthy opinion on my post here, yesterday. In response to your post I believe you are completely accurate in your assessment of the likes of zillow. I discussed this whole thing with my wife last night as she seemed concerned how these “low-cost services” might affect her profession and those in it. I told her the likes of what you said here today. Its nice to know I am not alone in my perspective. Zillow has a toy, takes advantage of Google Maps(Earth) which is a great tool for mapping, marketing, etc.. homes for sale. But, if any venture is a go it alone one that integrates these technologies they have a long road to travel before they even become somewhat effective. If you embrace the existing methods, MLS, IDX feeds and the like…integrate those databases, etc… then you have a great service offering. Perhaps in time the industry will evolve into a more efficient model but re-inventing the wheel has never worked. All-in one products might be “neat” but they don’t do any one thing really well. Give me a product/service that specializes and you have a great product/service.
Finally, zillow’s stated margin or error (even though its Beta) is FAR from its actual results. Which is exactly why it “borders on irresponsible”. In trying to stay objective and still share the truth (bottom-line): An argument could be made about SOME agents inaccuracy of pricing a home. Can this be measured and statistically tracked? This remains to be seen and proven one way or the other. But, it can be said, no matter what the profession, there is almost no monetary value you can place on Great Customer Service. And you can’t get that from a faceless, nameless interface on the Internet.
Our house in CO is about 10K lower than what realtors have estimated it to be at and from what we’re selling it for! Also, square footage was off. But it’s a good idea to get a ballpark!
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