How Accurate Are Home Value Estimates?
“What’s your home worth?” For more than ten years, websites have been advertising this phrase giving homeowners and home buyers an estimate into what the home they are looking at should, could, or would sell for. Which is a great starting point to get a basic idea of a home’s value but comes with some flaws. When the estimate is too low, the website is terrible and inaccurate but when the estimate is too high, it’s the gospel truth and cannot be wrong.
What to do?
How can this be?! How can something on the internet possibly be inaccurate? The problem many websites have is as simple as limited information. For many of these sites, the home value estimate are based on previous home sale prices and the prices of homes currently on the market. Other factors websites may include are amenities, such as pool or waterfront; However, if the information has been neglected, the estimate is likely to be off. Some websites, like Zillow for instance, allow you to input information for the chance to get a better estimate. The one downside to this though is when one house has all the information filled out and the other homes do not, you still have the same issue.
Where’s the best place to go for a closer home value estimate? Zillow says it perfectly,
“We encourage buyers, sellers, and homeowners to supplement Zillow’s information by doing other research such as:
- Getting a comparative market analysis (CMA) from a real estate agent
- Getting an appraisal from a professional appraiser
- Visiting the house (whenever possible)”
Visiting the house (if you can) is always a great idea, a professional appraiser is fantastic if you are highly interested in the property, and of course, I would be more than happy to give you a free Comparative Market Analysis.
Just like anything else in life, do your research and then hire a professional.