Recently, I’ve heard a few people comment on the “Zestimates” they received on their estimated property value from Zillow.com. One person in the L.A. area stated that Zillow used a nearby condo complex, which had several closed sales to determine an estimate of value for his house, a single family residence. It’s basic real estate knowledge that a closed condo sale cannot be used to determine an estimate of value for a single family residence. After having a licensed appraiser perform an appraisal on her property, another property owner discovered that Zillow was quoting her estimate of value at $150,000 below appraised value.
This prompted me to do my own research on the topic. What I discovered specific to the Mammoth real estate market is that Zillow was estimating property values at least $100K to $175K under market value (for single family residence). Because Mammoth is such a small area of only 4 square miles and is also a resort market, the generalized formulas that Zillow uses to determine value estimates proves to be significantly off base. Taking a property that recently sold on Monterey Pine, which backed right up to Chair 15 (ski-in, ski-out), Zillow’s estimate was $875,000 in November of 2011. This home, which was listed at $1,149,000, just sold last week for $1,000,000. In researching other Mammoth properties, and in comparing estimated values from Zillow versus actual closed sales, I discovered a similar trend.
In some cases, the Zillow estimates can “coincidentally” be correct, but it appears to be more of a mere coincidence rather than any real credible formula used to determine property value estimates. Anyone who is looking to find out what their property value is should not rely on the information provided by Zillow. It’s always best to contact an experienced agent to determine an estimate of value for your property based on tried and true criteria: Year built, room count, square footage and similar-type closed and pending property sales in the immediate vicinity, or contact an appraiser.
Feel free to post your comments, or contact me for more information.
Verena Robinson, Broker Associate
Re/Max of Mammoth
DRE License #01512209
toll-free (877) 924-8521