Zestimate is a Zillow.com registered trademark that offers Zillow's best guess at the market value of a particular property. It is not an appraisal. Many factors influence the accuracy of the Zestimate including the quality of the data that it is based on and the timeline of updates to that data. Zillow gets a lot of it's Zestimate data from county and township property tax records. Many counties do not provide accurate data or do not allow automated feeds of this data to outside entities. Zillow merges this information with other sources including the homeowners themselves, Realtors and other Real Estate representatives, Multiple Listing Service (MLS) providers, and data syndication companies. Zillow does it's best to assess the reliability of the information but sometimes duplication or conflicting information is received and Zillow is forced to weigh the reliability of the source in determining which information to use in its Zestimate.
Many times, updates (or lack thereof) to properties make significant differences in the market value of the property. Unless these updates are reported to Zillow, they will not be considered in the Zestimate. If a property hasn't sold in a long time, and if no building permits or mortgages were recorded, the Zestimate can only be based on the best information available, which in this case would be "Not Much"!
Even Zillow recommends that the Zestimate not be used as an appraisal of value, but only a 'guestimate' of relative value. You should not make important decisions based on this information. I have personally seen a home with a Zestimate of $768,000 sell for $1,320,000! The buyer didn't overpay, it was just a case of a very diverse neighborhood and a home with significant updates over a very short time. In situations where a home was torn down to build a new home, I could imagine even more of a margin for error.
More information at http://www.zillow.com/wikipages/What-is-a-Zestimate/
Take a critical/skeptical look at the Zestimate and use it with a grain of salt. It may provide a good idea of the approximate value of your home. You can also ?claim? your home on Zillow and add pertinent information. If the information is tangible and deemed reliable, Zillow may update the Zestimate based on that information. Don?t get your hopes up, but they claim to recalculate based on a change in certain criteria.
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If you are considering refinancing your home, you should contact a Mortgage professional to provide the best strategy for proceeding. Most any refinance will require a professional appraisal of the property, which will be far more accurate than the Zestimate.
If you are considering the sale, or a purchase of a property, you should contact a Realtor to provide the proper Market Value for the property in question. This should not be ?off the cuff? or over the phone, and it will entail the Realtor visiting the property (and possibly other properties in the area) to analyze the various market factors that affect the property?s value.
If you have further questions about the Zestimate or to get referrals to qualified professionals that can assist you with your specific needs anywhere in the country, please contact me at: