I am always amazed about why people love Zillow. As a real estate professional, I understand Zillow appears to have the market cornered. They have a great website that’s easy to use and they seem to have all the answers. That’s what they have going for them.
But at the same time, it’s hard to believe their information is so inaccurate and yet people tend to believe everything they find on Zillow. I hear it day in and day out…
“Zillow says my house is worth $400,000. My natural thought is, “Has Zillow ever been to your house?”
Or the other one…
“How much is the house at 123 Main Street?” My response is “That house sold last year.”
Their natural response is, “No it didn’t, it’s on Zillow.”
And then it starts. When people tell me what they found on Zillow, I know I’m in big trouble trying to prove Zillow is wrong when I already know how much people love Zillow.
What is Zillow?
According to Wikipedia:
“Zillow is the leading real estate and rental marketplace dedicated to empowering consumers with data, inspiration and knowledge around the place they call home and connecting them with the best local professionals who can help.”
Actually, Zillow is a computized database that allows you to search for homes and estimates your home’s value. Neither of those is very accurate. But one thing is for sure, once you give them your information, they will sell it. That’s what they are very good at…getting you to give them your information.
The Zillow Zestimate
One of Zillow’s unique features is the Zillow Zestimate where consumers can see how much homes are worth. Zillow’s algorithms update property values three times a week, which comes from public data and from data submitted by users.
According to Zillow, most Zestimates are “within 10 percent of the selling price of the home.”
10%? On a $300,000 house, their Zestimate could be off $30,000 either way – too high or too low.
A Perfect Example of an Inaccurate Zestimate
In July of 2015, Zillow’s CEO, Spencer Rascoff, sold his house. The Zillow Zestimate said his house was worth $1,750,405. That alone would be a reason why people love Zillow. That’s like hiring an agent to sell your house that tells you they can sell your house for more than any other agent without any data to back it up. Prove it.
However, his house actually sold for $1.05 million which was 19% below his original list price. Does that make you believe the people at Zillow have all the answers?
The day after his house sold, the Zillow Zestimate once again said the house was worth $1,750,405 which is why Zillow should never be used to determine the market value of your home.
The Truth about Zillow
What Zillow is really good at is keeping consumers in their loop, giving you information about a home that might be available or could already be sold. When you give Zillow your name and contact info, they capture it and then sell it back to the agents that provided them with the listing in the first place.
Zillow has agents around the country that pay top dollar for those leads. (We are not those agents). They also pressure some Realtors into entering into costly advertising contracts just to protect and maintain their very own listing information. Buying leads is expensive and that’s why you will hear from an agent as soon as you enter your contact information. That agent just paid big bucks to try to nab you as a client.
The only SOLD information Zillow ever receives is when an agent goes in and updates their own listing. Zillow doesn’t want to have houses that are sold on their site so that’s why they don’t update it when a house sells. SOLD houses don’t attract buyers. Zillow wants every house to be available.
Zillow wants you to inquire about any house you see. Capturing your information is what they want to do so they can sell it back to the agents and any other businesses that want you as their customer as well. Selling your information is not in their Wikipedia description.
What Else Does Zillow Own?
These are other entities Zillow owns:
- Diverse Solutions
- Mortgage Lenders of America
- Naked Apartments
It seems as though, they want to acquire any real estate related company that has a huge database behind it.
Keller Williams had a contract with dotloop which helped them with the storage and signing of real estate documents online. When Zillow bought dotloop, Gary Keller ended that relationship. He didn’t want KW’s customer information to be readily available to Zillow. Good for him!
Want a Better Way to Search for Local Real Estate?
Whether you are looking at houses for the fun of it or for real, you don’t have to go to Zillow to do that. Zillow doesn’t have the most accurate information available. That’s why you’ll see a house that sold a year ago show up on Zillow as an active listing.
There are better ways to find out what’s for sale locally and discover the real value of your home versus the Zillow Zestimate without having your information sold. You can:
- Search local homes for sale with our app through Heartland MLS
- Receive your home’s current value based on recent activity in your neighborhood
- Call or text (913) 515-3250 for a quick walk through of your house to see how it actually compares to other homes that have sold in your neighborhood
- Contact us here and we’ll get right back to you! And we won’t hound you because we paid for the lead.:)