How Accurate Is Zillow Zestimate
The Zestimate® home valuation model is Zillow’s estimate of a home’s market value. A Zestimate incorporates public, MLS and user-submitted data into Zillow’s proprietary formula, also taking into account home facts, location and market trends. It is not an appraisal and can’t be used in place of an appraisal.
Zestimate Accuracy
The nationwide median error rate for the Zestimate for on-market homes is 2.4%, while the Zestimate for off-market homes has a median error rate of 7.49%. The Zestimate’s accuracy depends on the availability of data in a home’s area. Some areas have more detailed home information available — such as square footage and number of bedrooms or bathrooms — and others do not. The more data available, the more accurate the Zestimate value will be.
How is the Zestimate Calculated?
Zillow publishes Zestimate home valuations for 104 million homes across the country, and uses state of the art statistical and machine learning models that can examine hundreds of data points for each individual home. To calculate a Zestimate, Zillow uses a sophisticated neural network-based model that incorporates data from county and tax assessor records and direct feeds from hundreds of multiple listing services and brokerages.
FAQs
Here are some more details about the accuracy of Zillow’s estimates.
Is Zillow Zestimate usually right?
Zestimates are mere estimates of a property’s value, not a true valuation. As such, you can expect your Zestimate to be around your home’s value, but don’t expect it to be exact. Additionally, if your home is in a remote area or there haven’t been recent home sales in your neighborhood, the Zestimate is likely to be more inaccurate. That’s because the algorithm can’t conduct an accurate comparative market analysis — a crucial step to valuating a home.
Are Zestimate usually higher or lower than others?
Zillow’s Zestimate can be higher or lower than other estimates of a home’s value, depending on the specific property and the local real estate market. The company itself acknowledges that its Zestimate is not always accurate, and it provides a range of the estimated value as well as a “Zestimate Accuracy” score for each property. These tools can help provide more context for your Zestimate, and help you determine if it’s on the higher or lower end of the range for your home.
Why is Zillow Zestimate inaccurate?
The most common reasons for inaccurate Zestimates are limited data, market volatility, and data errors. It’s important to remember that your Zestimate is only an estimate based on a proprietary algorithm and the information it’s fed. If there are inaccuracies in that data, the Zestimate will also be inaccurate.
What are some alternatives to Zillow’s Zestimate?
There are many other online home estimators. Read the fine print of these valuation tools to understand if they are a reliable source of data for your neighborhood or not. When in doubt, consult a professional. You can also get an free estimate of your home’s value with Orchard. Get started.