Trying to understand the real estate market is intimidating for most people, no matter how many times they’ve bought or sold a home. In the past decade or so, these buyers and sellers have largely turned to Zillow as a resource—but how helpful is Zillow actually? In this article, we’ll pit Zillow’s user-friendly strengths against its potential pitfalls.
Is the Zestimate Accurate?
Zillow is widely recognized for its Zestimate feature—an algorithm offering estimates of home values. While the Zestimate serves as a jumping-off point for many, its precision has sparked numerous discussions.
For off-market homes, Zillow itself estimates that the Zestimate is off by a median rate of 7.49%. For example, on a home that the Zestimate values at $500,000, the median room for error is $38,000! With this in mind, it’s clear that sellers who depend on the Zestimate to price their home risk disappointment. Underpricing could mean losing tens of thousands, while overpricing by the same amount could jeopardize their chances of selling.
After a home is listed on Zillow, the Zestimate frequently adjusts—Zillow claims that the median error rate decreases to 2.4% at this stage. However, once a home is listed, the Zestimate is far less valuable since a listing price has already been decided on.
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How Does Someone Become a Zillow Premier Agent?
Being a Zillow Premier Agent does NOT mean an agent works for Zillow—it means that they are a real estate agent who pays Zillow for leads and promotion. This means that their brokerage, amount of experience, and schedule can all vary widely.
The one thing all Zillow Premier Agents have in common is that they pay Zillow for leads. If you’ve ever requested information about a property, your contact info has been sent to multiple premier agents to try to win your business. The result? Multiple agents reaching out to you—quickly, and often repeatedly. This process can put a bad taste in buyers mouths, ultimately leading to the question: is Zillow trustworthy?
Unfortunately, your mileage may vary with Zillow Premier Agents. Just because an agent reaches out to you doesn’t mean they know the area or have more info about the house—it simply means Zillow sold them your information. Instead of submitting requests on Zillow for any houses that catch your eye, it’s a good idea to find an agent you trust and ask them for more info instead.
Zillow Statuses: What Do They Mean?
Most properties feature on Zillow whether or not they are on the market. While some statuses may seem intuitive, astute buyers and sellers can lead to read between the lines and give themselves an advantage in the market.
Common Zillow Statuses:
- Coming Soon: A listing that is preparing to go live but cannot yet be shown. This “coming soon” period allows the seller to get more eyes on the home and drive up interest once live.
- Tip: contact your agent to find out when a “coming soon” listing will be live to ensure you’re one of the first showings.
- For Sale or Rent: Fairly straightforward, these listings are currently on the market.
- Pending: There is an executed contract on the property—it hasn’t closed yet, but is pretty likely to.
- Off Market: The home is unavailable. While this often means the home wasn’t listed recently, it can also mean a seller has changed their mind.
- Tip: if an “off market” home was recently “active” and didn’t sell, there’s a chance that a strong enough offer will sway the seller. Your agent can help you get further info in these situations.
- Other Statuses: Zillow also has statuses such as ‘Foreclosure’—some of these statuses indicate a more complicated situation. It’s a good idea to speak with a real estate professional to learn more about non-traditional sales.
Zillow: The Pros
As a tool available to the general public, Zillow does a good job of providing valuable information in an approachable manner.
A few positives:
- Convenient hub for home buyers and sellers: Easily access information on current listings and off-market homes, including recent sales, tax details, and school information.
- Supported by the MLS: The MLS serves as the platform for real estate agents to list and locate properties. Zillow extracts information from the MLS, ensuring the highest level of accuracy by sourcing directly from the listing agent.
- Multiple listing types: On top of the well-known home sale list, you can use Zillow to view rentals, foreclosures, and other opportunities.
Zillow: The Cons
While Zillow’s allure and widespread use are undeniable, it is not without its imperfections. Prospective buyers and sellers should stay mindful of the platform’s limitations before diving into significant decisions.
A few drawbacks:
- Possible sync delays: Zillow can take up to 24 hours to sync from the MLS, which can be a significant amount of time in a hot market. This also sets up the potential for disappointment when a property shows as available but isn’t.
- Zestimate flaws: We discussed the potential for inaccuracy in the Zestimate above, but it bears repeating that an algorithm isn’t able to take nuances into account when giving you a number.
- Expert advice is irreplaceable: Zillow’s major drawback lies in its incapacity to match the insights and personalized touch offered by experienced real estate professionals.
How Can Buyers and Sellers Leverage Zillow?
Zillow stands as a transformative platform that has revolutionized individuals’ approach to real estate. Understanding its intricacies and constraints empowers consumers to leverage this tool strategically—while avoiding its pitfalls. Ultimately, the human touch remains irreplaceable in real estate, and though Zillow has a lot to offer, it’s not an exception to the rule.
- A place to start: Perusing Zillow can help to familiarize you with the market, but should not be your sole source of information.
- Stay smart: It’s important to remember that listings and estimates can change and are only part of the bigger picture.
- Professions are here to help: A good agent can help you make sense of what’s on Zillow and bring more information to the table. While Zillow is great in the beginning, your agent will act as your guide from start to finish (and beyond).
