Study shows Zillow doesn’t get it right when it comes to housing prices in the Tri-Cities
You've probably looked at websites like Zillow and been amazed at just how much your Tri-Cities-area home is worth.
A local realtor took a look at 532 recently sold homes in the Tri-Cities and compared the actual sales price with the Zillow "Zestimate®" and found that the numbers don't necessarily match up.
"In some cities, there's a 30 to 40% chance that the Zestimate® is wrong by more than 10%," says Cari McGee, a licensed realtor with Keller Williams Tri-Cities. "Pasco tends to be high by just about 2%, but in most cases, home value can be wrong by 6 to 9% in most of the Tri-Cities."
She says many sellers come to her ready to list their home for the amount they see on the Zillow website, and it's something realtors deal with on a regular basis.
"People will say, 'well, Zillow says my house is worth X.' And we have to explain that actually their numbers are wrong and we're not sure where they're getting everything, but it's not the same place where we're getting our data, which is accurate sold data. That's what enables us to compare prices and create a market analysis that will give you a true number of what your house should sell for."
Some of the discrepancies McGee's real estate team discovered as it researched the numbers:
- Pasco Zestimates® (2% median error rate) are significantly more accurate than Kennewick (7.7%), Richland (8.2%) and West Richland (8.7%).
- Across the Tri-Cities, about 16% of homes had Zestimates® that were at least $50,000 wrong.
- The more expensive a home is, the more inaccurate its Zestimate® is. Homes that sold for $300,000 to $399,999 had a median error rate of 7.2%. Homes that sold above $400,000 had a 7.5% median error rate. Homes that sold for $225,000 to $299,999 were the most accurate, with a 3.3% median error rate.
- The most accurate Zestimate® was for a Richland home that sold in May for $13 more than its Zestimate®.
- The least accurate Zestimate® was for a Kennewick home that sold in May with a Zestimate® that was $208,335 higher than the sales price.
On its website, Seattle-based Zillow discloses the fact that the information they provide is not an appraisal, and should only be used as a starting point. They also encourage sellers and buyers to get a comparative market analysis from a realtor.
McGee says the best way to find out how much your home is worth is to contact a realtor for a comparative estimate based on the current market and the sale of other similar homes in your neighborhood.