Why You Should NEVER Just Trust A Zestimate To Value Your Property

If you're thinking of using a Zestimate to value your home, you should read this first!

A lot goes into determining the value of a home. Almost everyone is familiar with the popular real estate website Zillow. Whether you've been a casual browser checking out real estate markets in various areas around the world, or you're a homeowner who has visited the website in search of their own address, there's no doubt you've probably heard of their famous (or infamous depending on who you are) estimated home valuation tool: the Zestimate.

While there may be a little truth to some of Zillow's zestimates, there's really no substitute for an in person valuation based on real world market data and personal experience of a REALTOR®. This is especially true if you have a unique property and don't reside in a "cookie cutter" development. While there's nothing wrong with being in a neighborhood of similar homes, there are still going to be large to small differences, even between the exact same floor plan, with homes in the exact same neighborhood that a experienced REALTOR® will notice that Zillow's zestimate simply cannot. Some of these noteworthy items that cannot be picked up by an algorithm are a new roof, updated kitchen & baths, new flooring, updated windows, high-end appliances & fixtures, equestrian facilities, waterfront & properties with a view, lingering aromas...

You might see where I am going with this. If your home has been upgraded to the nines, but your neighbors are still sporting builder grade dated finishes, you shouldn't let that diminish your homes value via an algorithm. If your neighbor was known as the crazy cat lady who smoked a pack a day inside never opening a window, you shouldn't compare what that home sold for to the value of your home. Likewise, if your neighbor has fully renovated their home including a resort-style pool in their well landscaped backyard and it sold in a single day while your home still has a 20 year old roof atop and no pool, don't expect in this changing market for a buyer not to notice! Since the interest rates have returned to pre-pandemic levels and even higher, the days of buyers lining up to offer over ask on a sub-par home are pretty much over.

Another reason to be leery of the accuracy of these automated valuation websites is over the last few years you may have noticed a wave of "internet investors ready to buy your home instantly" aka "i-buyer" websites. You need to ask yourself: Would these websites be working in my best interest, to tell me the truth about the current value of my home if they are planning to make me an honest offer on which they still needed to turn a profit in order to stay in business? Probably not. Yet over the last two years, in some instances, these i-buyers bought up homes in neighborhoods quickly inflating homes values and then turning the homes into high priced rentals, limiting the inventory available to buyers.

In some areas where they weren't interested in renting the homes they bought, they did not zestimate very well, which led to their demise when they couldn't flip them when they tried to sell the overpriced, often poor condition homes to buyers. Now many of these i-buyers have closed their doors. While this worked out to some home sellers advantage over the past couple years where some homeowners were actually offered much more than their properties were worth, such a practice led to these companies holding properties for much longer than they anticipated, profits plummeted and they mostly, except for a select few, have all but stopped with this automated practice.

Sellers: Preparing to sell your home? Don't let the allure of an instant zestimate rob you of your real homes value, pricing your home right is always the best way to get it sold! Let your home shine the first time. Contact us today to get your home market ready and for a free market analysis of your homes current value!

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