Zillow Price Estimates, Right or Wrong?

If the Zillow estimated price for our house is correct, we have $25,000 in equity in our home. Given that we bought just over two years ago, I’m going to go out on a limb and say Zillow’s price estimate is wrong. I’m going to predict that the current equity we have in our home is closer to zero.

5 thoughts on “Zillow Price Estimates, Right or Wrong?

  1. Could be worse. You could be upside down, like all those people who cashed out of their houses to buy boats andtake vacations in France, and now owe more than the house is worth, and can’t afford the balloon payment.

  2. Before I saw the Zillow estimate, I figured we were probably slightly underwater. Either way, it doesn’t really matter, as we’re not planning on selling anytime soon. The monthly payment we have isn’t much worse than the rent payment for the apartment, and we have a lot more space inside and out than we did at the apartment.

  3. I would love to know how Zillow does this estimate as well. Our house has ballooned about $60,000 in the last six months, and I am not quite sure based on what. (We are no longer underwater, if Zillow is right, although the house is still worth $80,000 less than it was when we had it built.)

  4. Interestingly enough, the house across the street sold recently. I think the Zillow price for it is low, because it’s listed on Zillow as a 1 bathroom house. Houses here are all 15 years old or newer, and I’d be surprised if there is a one bathroom house in the subdivision. We have a half bath and a basement they don’t have, their house was initially listed at a few thousand below our breakeven point.

    Other houses in the neighborhood have taken much longer to sell, or haven’t sold at all.

  5. Of course it is wrong. It is algorithmic, and using an imperfect model that doesn’t fully account for all of the factors that would influence why someone would prefer your house over similarly-priced nearby houses or one of those houses over yours.
    But it keeps getting closer. I used it extensively when house hunting and always double-checked what Zillow (or Homegain, or …) used as “comperables”. Many were not.

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