Many people refer to online estimates when calculating the value of a home. When you are looking for a home estimate because you are interested in selling your home in Encinitas, buying a home, or just curious about the value of your home, it’s important to know that pricing a home is not an exact science based on mathematical algorithms.
Be Aware of the Facts Regarding Home Estimates
There are many websites that provide home estimates online. Zillow, one of the leading online real estate databases, offers their “Zestimate,”
which is, “an estimated market value, computed using a proprietary formula. It is not an appraisal.”
However, based on Zillow’s own data, these estimates can have a significant margin of inaccuracy; even across the state of California Zillow’s estimates can vary in accuracy. Nationally, the “Zestimate” has a median error rate of 6.9 percent, which means half of the Zestimates in an area are closer than the error percentage and half are farther off.
Why Online Estimates Can Be Inaccurate
Zillow “uses proprietary automated valuation models that apply advanced algorithms to analyze data to identify relationships within a specific geographic area.” Certain home characteristics are given different weights of importance for valuation; some homes may be very unique in ways that are not well captured by existing data, and the “Zestimate” may be less accurate on these homes.
Online algorithms do not necessarily factor in key considerations in determining value such as the following:
- Lot Size
- How much of the lot is flat and usable
- The extent of improvements and upgrades
- Whether or not the home backs a busy street
- Power lines
- Many additional factors
Trust an Encinitas Realtor with Your Home Estimate
There is no substitute for the guidance and opinion of an experienced real estate professional, especially one that has first-hand knowledge of comparable homes that have sold in the area, and knows how one home compares with another. An experienced Encinitas Realtor also understands the reasons and circumstances of why each home has sold and at what price. Real estate agents have a knowledge of market conditions, trends, and how they affect the market value of a home. Even certified real estate appraisers call upon the expertise of Realtors when gathering information to calculate the value of a property.
Before making a determination of home value, it’s important to have all the facts, understand the information, and trust an experienced professional to help put them in perspective.
Whether you are a buyer or seller or simply someone looking to get your home evaluated, contact Linda Moore for a free market evaluation.