When visiting with someone who may be considering selling their home I typically ask how much they think their home is worth. Sellers have generally either talked to a neighbor that recently sold or researched on the internet to come up with their number. Some of that research may include the popular website Zillow.com. While Zillow is a good platform for real estate information, many people using their Zestimate function do not realize that there is a margin of error and the level of accuracy varies by location.
Zestimate Accuracy Table
Each location is given a star rating based on accuracy. Notice the Dallas-Fort Worth area has two stars which is considered a “Fair Zestimate”. Now let’s look at what is considered “fair”. Zillow estimates that its Zestimate is only within 5% of the sales price 22% of the time, within 10% 39% of the time and within 20% of the sales price 63%. That means that for more than half of the estimates given on the site they can be off by as much as 20% – that is huge! Consider a home priced at $200,000 – that’s a $40,000 difference!
You certainly don’t want to price your home 20% higher (or lower) than what home are actually selling for so ensure you consult a trusted REALTOR(r) when you begin considering a move to see where you really stand in the market. We are always happy to discuss your home’s current value in the market, so don’t hesitate to ask!