While the idea behind Zestimates® seemed awesome for homeowners, it’s entirely frustrating for agents and often ends up disappointing their clients with inaccurate pricing forecasts. Even though Zestimates know a home’s approximate size and location, there are many factors they don’t take into account. That is why homeowners need to hire a real estate agent that can be their trusted advisor through every step of the home selling process, because Zestimate accuracy doesn’t cut it.
Zestimate Accuracy Backlash
What happens when Zestimates are seen without proper context or guidance? A lawsuit. While this is the first lawsuit of this kind, we are not surprised to see it come to light. It states that, “Homeowners, realty agents and appraisers have been critical for years about the valuation tool, citing estimates that too often are far off the mark — sometimes 20 percent or 30 percent too low or too high — and misleading to consumers. Zillow itself acknowledges errors.” That’s why we empower agents on our platform to be true consultants.
“The idea of an AVM (automated valuation model), an algorithm, that determines the price of a house is flawed from the very beginning,” said York Baur, CEO of Moxi Works. “There’s no such thing as standard housing product. If I buy a car, it comes off an assembly line, and they’re all the same. But every piece of property is different.”
Baur went on to say that, “Zillow has been very clever to give consumers a ballpark idea of what their house is worth, but it’s just that: A teaser to get them onto the website. So, why would anyone leave the most financially and emotionally charged transaction in someone’s life to a computer? You wouldn’t. Like with any large investment decision, you would seek professional advice, and that’s what realtors give you.”
Our CMA presentation tool, Moxi Present, encapsulates the relevant information about a house and enables a professional agent to consult and advise their client with accurate information, and information that can give true context to a Zestimate. “A realtor using modern tools like Moxi Present, has access to a wealth of data beyond what some computer algorithm is using and in particular can access things that no algorithm can,” said Baur. He means things like the details of a home’s interior or the exact character of a given neighborhood, which only an agent, a human, can speak to.
The importance of using a trusted advisor cannot be overlooked. As we all well know, this is one of the most important and personal transactions in someone’s life, and it needs to be treated accordingly. If you were to get a surgery, would you consult a professional first?