Interested in the value of your home? Here are some options to research it yourself.
In the past year or so, a number of Web sites have sprung up which provide a free service to consumers interested in knowing the value of a specific piece of property. Web sites such as www.Zillow.com, www.RealEstate.com, www.Reply.com, and www.RealEstateABC.com provide such services.
For a long time your local Real Estate Broker/Agent and Appraiser were the only readily available sources for such information. Now, in the privacy of your own home using your computer, you can research the value of your house, your neighbor’s house or, for that matter, almost any house that interests you. An address and a zip code are the only pieces of information you will need to use these search tools. Just a word of caution, the valuation you get from these searches may be accurate or may be wildly inaccurate.
In a Wall Street Journal article entitled “How Good Are Zillow’s Estimates?”on February 14, 2007, James R. Hagerty stated that in an analysis of 1,000 recent home sales the estimates of home value they studied “often are very good, frequently within a few percentage points of the actual price paid. But, when Zillow is bad, it can be terrible–off the mark by 25% on one in ten homes.”
While Real estate agents, appraisers, and the online valuation services all use the same basic data sources, the online services are limited by their inability to go and visually inspect a particular property. Thus they cannot ensure that it is, in fact, comparable to those around it. Herein lies the source of a lot of the inaccuracies found in online data, which assumes that certain similarities exist, while, in fact, there may be wide differences amongst houses compared, even within a single neighborhood. If a house being analyzed comes from a neighborhood where there are a lot of homes similar in age and size, and these homes all have the same amenities, the estimates can be quite accurate. If, however, the house being analyzed comes from a neighborhood in transition, whether improving or going down hill, the neighborhood comparables are potentially going to lead to inaccurate and misleading valuations.
Another factor that can potentially lead to an inaccurate valuation is that the information on record used to make the analysis may be incomplete, failing to take into consideration whatever improvements have been made to the property. Perhaps a kitchen has been upgraded, or a bathroom has been added. Or, on the downside, the property may have suffered from neglect or some calamity. Only by having “feet on the street” can you ensure that all factors relevant to your property are being considered in a valuation. Hence the punch line of this article: by all means, utilize an online valuation service to provide a data point as you start your valuation process. Just remember, it is but one data point and may be quite inaccurate.
Your best bet as always is to seek the support of an experienced realtor who is familiar with your neighborhood and has the information on your local market with all of its idiosyncrasies and variables. A REALTOR has at his disposal all the tools necessary to give you the best estimate of value possible.