One of my out of town clients has been using Zillow to check the value of homes that he's interested in seeing when he arrives here in the Foothills. And in his words, "this is kind of scary".
What's scary is that he's found that Zillow's values are sometimes as much as 20-30% lower, but occasionally higher, than the asking prices of homes that otherwise seem to be at least reasonably close to being reasonably priced.
And of course that concerns him. But he's also concerned that even if he were willing to pay somewhere in the neighborhood of the asking price, that the property would not appraise and therefore a bank would not give him a mortgage to purchase the home.
So hoping to shed some light on this dilemma, and not wanting to dilly-dally around with my opinion of value vs. Zillow's, I thought the best thing to do would be to look at homes that have sold recently in the Foothills, and compare those sold prices to Zillow's zestimates.
A buyer and seller agreeing on a price, and a lender willing to give a mortgage for that home at the agreed sale price - based on a boots on the ground appraisal - is as reliable a definition of market value as we have. And though they use cuter terms than market value, market value is what Zillow claims to provide.
**in their own words in the fine print Zillow offers;
A Zestimate home valuation is Zillow's estimated market value.
It is not an appraisal. Use it as a starting point to determine a home's value.
OK will do, let's see. I've pulled a list of homes that have sold recently in the Tucson Foothills along with the actual sold price vs. Zillow's zestimate for those same homes. What could be simpler.
The following homes have all sold within the last 14 days. And I started with the highest priced sale and worked my way down, one-by-one, and did NOT (though I wanted to) select particular homes in order to make a point.
4207 N Sabino Mountain Dr Tucson, AZ 85750
Sold 1/15/09 = $1,250,000 MiSS
Zillow's zestimate = $968,000,
with a cover their butt Value Range of $793,760 - $1,035,760
which at that, didn't quite cover it
6241 N Ventana View Pl Tucson, AZ 85750
Sold 1/19/09 = $625,000 HiT
Zillow's zestimate = $636,500
Value Range = $528,295 - $681,055
4962 N Bonita Ridge Ave Tucson, AZ 85750
Sold on 1/8/09 = $510,000 MiSS
Zillow's zestimate = $458,000,
Value Range = $393,880 - $490,060
8301 E Big Horn Tr Tucson, AZ 85750
Sold 1/16/09 = $445,000 MiSS
Zillow's zestimate = $406,000
Value Range = $328,860 - $442,540
5148 N Louis River Way Tucson, AZ 85718
Sold 1/12/09 = $459,000 MiSS
Zillow's zestimate = $501,500
Value Range = $416,245 - $551,650
5050 N Via Gelsomino Tucson,AZ 85750
Sold 1/14/09 = $425,000 too close to call
Zillow's zestimate = $455,500
Value Range = $378,065 - $482,830
Need I go on. A lot of MiSSes and not too many HiTs.
Of course the Value Range usually has it covered, but then again, I'm pretty sure lots of people could hit that target with their eyes closed.
So the moral of the story is, if you depend on Zillow to determine the value of a home in the Tucson Foothills, do so at your own peril, because it's likely to be incorrect.
see my web site thefoothillsToday.com
to search for and learn more about Tucson Foothills Homes
