Friday, July 20, 2018

Be Wary of Online Home Value Estimators

be wary of online home value estimators
We have all seen the Zestimate® home valuations and perhaps you have visited several other online valuation programs thinking you were getting a good representation of the value of your home. Beware! Most online home evaluation companies have limited base data to pull from and their results may be skewed to only the data that they have available.

AVMs or automated valuation models generate a property price based on computer algorithms and calculations that take several sets of data and then look for relationships and patterns in that data. Computers has no knowledge of specific areas and amenities that might affect the valuation of your home.

Here are some main sources of online AVMs.
  • Realtors Property Resource or RPR. They use two methods; their AVM estimate and the Realtors Valuation Model (RVM). Difference being the RVM uses the AVM data plus input from the MLS. This program shows accuracy based on estimate ranges and confidence scores. Although available only to Realtors, it does allow for customization by the Realtor for your specific property. Valuation using this tool maybe higher than others due to that individual input. 
  • Realtor.com. Uses tax assessment records, recent sales of like properties and a few other factors to value your home. This tool is free and available to the consumer. 
  • Redfin. A web-based real estate brokerage that will give you their estimate of what your home is worth. The use market, neighborhood, home-specific and recently sold data from the MLS. They believe their values are more accurate for homes currently on the market than ones off the market. This tool is free and available to the consumer. 
  • HouseCanary. They provide valuations and forecasting. They use property-level data from public records and MLS. Accuracy depends on availability of data. Estimates available upon subscription only. 
  • Zillow and Trulia. As mentioned in the beginning, Zillow has their Zestimate valuation tool which uses public data and user-submitted data available on the property and its location. Since Zillow owns Trulia, it is likely that they use the same data core. Accuracy of valuations are suspect since only valuate based on often incomplete public records and user input which is often not as detailed as it should be. This tool is free and available to the consumer. 
  • Eppraisal.com. Also uses data which is available through public access. Depends on the completeness and accuracy of said data. This tool is free and available to the consumer. 
Some websites will provide you with estimates by request only but rely on user inputs. Some banking and financial institutes will also provide estimates of home value to accompany the other financial services they provide. Some real estate brokerages provide estimators through their websites. All these valuations use various public data available to them and some user input. Accuracy on these valuations would also be suspect.

With technology continuing to advance and more sites becoming available with public data, we may see some of these valuation tools become a bit more accurate in the future. However, no valuation is as accurate as the one your Realtor can give you. They are familiar with the area, neighborhood, amenities and market conditions that all affect your valuation. You can’t justify a high valuation if the local market won’t support it.

This is where I come in. If you are interested in getting a current market value for your home, I can offer you a FREE comparative market analysis (CMA) which will use details from your home and the local area to get you an accurate home evaluation. The only thing better would be paying for an appraisal which might cost you $400-$1000.

And remember if you, a friend or family member need assistance with selling or buying a home I can help. Referrals and people needing relocation assistance are welcome! Search Single Family homes in Greenville. Search Condos and Townhomes in Greenville.