For most home owners, finding the value of their home is far too complex or confusing to attempt on their own.
While there are multiple avenues homeowners can use to find the value of their home, many are turning to the internet and sites like Zillow to find out how much their home is worth.
While Zillow does do a decent job of placing your home in a ballpark range of what it’s actually worth, you shouldn’t embark upon selling your home based solely on a “zestimate”.
Let’s take a look at all the reasons why zestimates are not suitable for giving you the most accurate assessment of what your home is actually worth.
The median error rate for zestimates is usually over 5%., with some states reaching over 10%. The nationwide average error rate of a zestimate is actually around 8%, which means that while sites like Zillow may be a good starting point, they can not be relied upon solely.
Part of the reason Zillow tends to be so accurate in its production of zestimates is that most of the information it plugs into its value estimation algorithms tends to be user generated.
This means that unless you have the exact measurements down to the inch of things like square footage and other small details, there is going to be a margin of error there that adds up to more than you expected it might.
This is one of the single largest contributors to the median error rate being what it is nationwide for Zillow zestimates. Property taxes are a huge part of the home valuation process and that should not be overlooked by any means.
The same way that inaccuracies in basic information about your home can lead to a high error rate, inaccurate data about past sale prices or date of sale can also have a huge impact on the error rate of a zestimate.
Home improvements are often under reported and they can have a big effect on Zillow estimates. Even stuff that might have seemed like a relatively small and simple upgrade at the time can have more of an impact on the error rate of a zestimate than you think.
It can also be hard to determine the value of an upgrade.
They don’t always add the exact amount of value that you paid for to your home. An upgrade generally depends on the other homes in your neighborhood to determine its actual value.
Zillow can be a useful tool for determining approximately how much your home is worth, but if you really want the most accurate assessment of your home’s value, you should get in touch with a realtor.
Only they can give you the closest possible estimate, without a huge error rate. Due to many different factors Zillow has an error rate that is just too high to rely on solely when determining the value of your home.
With the right strategy, you can use both Zillow and realtor to get the closest estimate you can and be on the right track to potentially selling your house.
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