The highs and lows of parenting and real estate.

In the last week or so, I keep hearing about Jason was the first one to send it to me. He always keeps up on the latest technologies in websites, and he had read about it on one of his techie blogs. He told me to check it out. This weekend a family friend mentioned that she had been on it checking out the value of her house. The kicker was when I found a post about it on a random website I was surfing yesterday. The gal claimed that is the real estate agent of the future. Being that I am the real estate agent of the present, that statement sent me surfing on over to check out the competition.

I have to say, it seems to be complex and interesting program. It’s not, however, totally unique technology. If you go to the Maricopa county assessor’s site and do a parcel search, you have the option to click and pull up comparable properties. In the ARMLS system, Arizona Realtors have access to another similar program that pulls from the tax records. Here’s the thing, though, even though I have access to all of these programs, I never use them when determining the value of a property I am going to list. The big problem with programs like any of these is that they are dumb. They lack the human component. They don’t take into consideration the remodeling a home owner has done, or the fact that the property has been a rental and not well cared for. The programs don’t know that the market in a particular area is moving faster than another and that we can afford to ask more because of it. When it comes down to it, pricing a home is more of an art than a science, which is why a computer will never be better at it than a knowledgeable and talented human.

And here’s the proof for you:

Property A: A condo in the Central Corridor in Phoenix that I have been researching to possibly list for a client who lives in California.

Maricopa county assessor’s website says: $99,500
ARMLS tax site says: $98,500 says: $123,563
I say: $145,000

Yep, is the closest, and definitely the smartest of the programs. It’s unfortunately not smart enough to call the owner of the next door condo which was recently purchased for $98,500 that is dragging down the averages in all of the programs, and find out that he only acquired it through a cash offer to the known drug-offender who was living there and had completely trashed the place.

Property B: A house near me that just went on the market.

Maricopa county assessor’s website says: $157,500
ARMLS tax site says: $351,621 says: $340,800
It’s currently on the market for: $410,000

This one’s all over the map with ARMLS winning closest bid. I think the big problem is again a comparable property that sold for $27,000. It was probably a gift to a family member or some other unusual situation, but it has the programs all confused.

So, in conclusion, I think is fairly brilliant in concept and design, but I think it needs some help in accuracy; and I’m not worried it will ever take my job.

PS – Curbed has a bunch of interesting comments on Zillow, and, even more interestingly, Zillow itself presents info on its own accuracy.

5 Responses to

  1. I was going to point you at that site when I read about it in the NYTimes. Of course, I zillow’d our house just to see what it would say. I’m guessing plenty of people will go there to get a first-cut at a house price, and then ask you to justify any difference you recommend, kind of like the BlueBook appraisal of a car’s value. Of course, it will only be the BlueBook of housing if it proves itself over time.

    I agree with your assessment, it’s just another piece of information that the smart participant (whether buyer, seller, or agent) uses to fill in the whole picture.

  2. Kelley Blue Book is and interesting comparasion, but I’m not sure I think zillow will be even close to as accurate as that. Houses are so much more subjective. Cars, at least, were all the same when made, and probably won’t have additions put in after they were built that make them better. And what about custom houses like yours? Just comparing your house to your neighbors’ isn’t going to cut it. Plus, cars don’t have a location. You could have the exact same house, 25 miles apart and they would be worth totally different amounts to different people. It’s just such a tough thing to automate, I think.

  3. Ha! I totally heard about zillow because the head guy was on NPR last week.
    All these people wrote in letters that they read on Thursday saying that they all looked up houses they owned or had owned, and Zillow got them all wrong.
    But yeah, I’m with ya. Gather information wherever you can get it.

  4. With Zillow I have a home with 2.75 bathrooms. Where is my other bathroom! Is there a basement that I don’t know about?

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