it’s been awhile, (and things are slow) so let’s check in with Zillow

and see if, after all this time, they’re still as far off the mark in their valuations of Foothills homes as they’ve always been.

The criteria;
I ran a search in the Tucson MLS for single family homes in the foothills that sold from July 1, 2010 thru today (8/12/10), listed from $750,000 to $1,250,000 and sold at whatever price they sold at. 
That’s it, nice n’ simple, with nothing to complicate things or throw a monkey wrench into Zillow’s sacred secret formula.

A grand total of 8 homes fit that criteria -
So without further ado, here they are, along with Zillow’s Zestimate of their value vs the actual sold price of the 8 homes as reported in the Tucson MLS.

1. 6005 N Pontatoc Road, Tucson, AZ 85718
Zillow says - $764,500
Actual Sold price - $747,000

2. 6616 N Los Leones Dr, Tucson, AZ 85718
Zillow says - $1,082,000
Actual Sold price - $725,000

3. 4210 N Saranac Drive, Tucson, AZ 85718
Zillow says - $636,000
Actual Sold price - $790,000

4. 6920 N Solaz Primero  Tucson, AZ 85718
Zillow says - $610,500 (range $488K – $684K)
Actual Sold price - $840,000

5. 3141 E Crest Shadows Drive, Tucson, AZ 85718
Zillow says - $751,500
Actual Sold price - $887,500

6. 7915 N Sendero De Juana Tucson, AZ 85718
Zillow says - $738,500  (range $583K – $812K)
Actual Sold price - $915,000

7. 3250 E Sun Cloud Place, Tucson, AZ 85718
Zillow says - $1,140,500
Actual Sold price - $1,000,000

8. 2801 E Plaza Encantada, Tucson, AZ 85718
Zillow says – we won’t even guess
Actual Sold price - $1,149,000

Please note that Zillow provides the following explanation/disclaimer of the Zestimate:
A Zestimate® home valuation is Zillow's estimated market value. It is not an appraisal. Use it as a starting point to determine a home's value.

That’s a good one, a starting point. Try a dart board instead, at least you’ll have a few laughs.

PS- and given the lack of anything remotely resembling accuracy in the very important area of home valuations in the foothills which Zillow, nevertheless, seems to pride themselves on, I can’t help wondering why so many real estate agents continue to advertise on and associate themselves with Zillow. Since doing so is clearly an endorsement of zillow.

thefoothillsToday.com
to find your Tucson Foothills home

Comments

[Sara Bonert]

@ PK Steffen agreed about how the various site count visitors! We spend a lot of time trying to figure it all out. We tend to trust Hitwise the most out of all of them.

[PK Steffen]

Axiom of this zeitgeist? I'd prefer to say that it gives buyers and sellers useful data and tools. Maybe a bit more prosaic, but let's be clear, it's just a web site and one which has been shown to be a purveyor of some useful data and some clearly not so useful. No matter how "insanely popular" it is.

As far as monthly unique visitors are concerned, they vary according to who tallies them. I really don't mean to put out your fire, but I would never trust someone's visitor count nor use it to judge the value of one site over another. They are about as reliable as some election results.

[Sara Bonert]

Hey all, Sara from Zillow here. Wow, great conversation and a lot of interesting points made in the comments. I 100% agree that people are using Zillow for more than the just the Zestimates. And also to answer the question in one word as to why real estate professionals should market themselves on site - audience.

Thanks to Jent for providing the ComScore numbers above. I can tell you our internal numbers put us at 11.7 M visitors last month. (ComScore doesn't count mobile traffic, which as you state, is becoming a significant amount of traffic)

I just wanted to add, in case people didn't know, that we do actually publish our accuracy numbers on the site by county. We use a methodology very similar to that in the blog post, where quarterly we look at the Zestimate on the day they home sold and calculate the deltas.

Here is a link to Pima County, where we state that we have a 12% median err rate, along with some other interesting data. http://www.zillow.com/howto/DataCoverageZestimateAccuracyAZ.htm I'll be the first to admit that I don't know a lot of the areas you have discussed in the comments, or Tucscon in general, so of course this 12% isn't specfic to a particular neighborhood. Agreed that the more cookie-cutter a home is, the more accurate we are likely to be. And also agreed that if you want an accurate understanding of what exactly is going on in a particular area, it is advised to work with a professional

[Jent]

JS Asks “does anyone use Realtor.com to shop for homes or other real estate info/resources.”

To answer this question I will use data primarily gleaned from “Experian Hitwise”

For the past few months it appears that Realtor.com has had roughly 11 million unique monthly visitors compared with Zillow.com’s roughly 8 million monthly visitors.

What these metrics do not convey is site traffic. Looking at other data concerning traffic it appears that Zillow.com has roughly 240% the activity of Realtor.com. What I infer this to mean is that Zillow.com users browse 3.3 times as many pages a month as Realtor.com users.

In terms of unique monthly visitors, Realtor .com has been the dominant player for a number of years with Zillow.com playing the second fiddle, but recent circumstances seem to indicate that circumstances may change.

Last month Yahoo Real Estate announced that it would combine forces with Zillow.com and their $87 million dollars of funding obtained by founder Rich Barton and “challenge on the dominance of Realtor.com”

Personally I don’t use Realtor.com because, for me, it isn’t user friendly. It doesn’t work on my iPAD, it doesn’t work well on my Macbook, and it doesn’t provide map based search.

Altogether, it doesn’t seem web 2.0 friendly.

[Jent]

PK writes “Watch out for words like empowering - they really are just buzz words.”

Well PK , let me expound regarding the context in which I used the word because It appears to me that it is the crux of the discussion that has evolved.

If we look to the Oxford English Dictionary we learn that the word Empower arose in the 17th century in legal settings involving the investment of authority or authorization to make decisions. It evolved in popular culture during the civil rights and women’s liberation movement, and I agree today it is used too often, without context, primarily in political movements and self help literature.

I utilized the word to symbolize the recent democratization in real-estate data that has been brought to those that own personal computers vis-a-via the internet, IE; a transparency of information previously unseen in this market. Zillow, in my opinion, is the primary illustration, even success story, of this transparency and paradigm shift, this shift represents a new Zeitgeist.

Individual empowerment through democratization of information is an axiom of this Zeitgeist not an attribute or “Buzz Word.”

[JD]

John, realtor.com is my baseline, first resource in home shopping, just to find what is on the market (MLS). I think a lot of realtors sometimes forget that we non-professional buyers usually do not have access to most MLS sites unless we're already working with a realtor who grants us temporary access. So, usually, unless it's a market where the MLS site is both easy to find and accessible to non-professional members without registration and fees, realtor.com is the closest thing an amateur buyer has to an MLS in most markets to get the broadest picture of what is on the market. However, for example, in Los Angeles, the westside MLS is both easy to find and allows guests to search listings, so when I was looking for homes in LA, I used that site as my "base" search site. So it depends on the market. Then, usually from realtor.com, properties I like I will then consult the specific realtors websites and, yes, usually zillow, for a second and third check. But again, from market to market, local real estate chains sometimes are really good, sometimes are really bad, if there's a particularly good local real estate chain website, then usually that will become part of the search as well (for example, in the Tucson market, I've found www.longrealty.com to be a pretty good site, so when looking at properties in tucson, I cross-reference realtor.com with their site - primarily because Long's "proprietary" listings (sorry, don't know the true real estate term there) usually don't have many photos on realtor.com, but they do on their site. In other metro areas, like Philadelphia, for example, realtor.com is your best bet. It really depends.

But, to get back to the main point (sorry for rambling there), from a generic, national perspective, realtor.com is usually the best place to start out when exploring a new market, and then from there you can get a feel for what the best more local sites to use are on a market to market basis. Plus, perhaps most importantly, it offers you the convenience of being able to track several markets simultaneously from the same site (for example, right now, I have save searches on realtor.com for both the Philadelphia market, where I currently live, to keep track of what is going on here for when I eventually decide to sell and relocate, as well as searches for the Tucson, Phoenix and Las Vegas markets that I am considering as possible retirement destinations.

[RD Harris]

John, see

http://www.ratetake.com/finance-news/0608201009274022.html

For a bit more on who owns what with respect to realtor.com and the licensing.

Seems like a mediator is negotiating between Move Inc. and the NAR ... so no telling what is taking place right now.

[john schneider]

Just wondering,
does anyone use Realtor.com to shop for homes or other real estate info/resources.
btw - Realtor.com is the site run by the National Association of Realtors.

[bruce]

Could be a good use for the portion of the fee the broker keeps. Many Brokers are charging an arbitrary 'administrative fee'. Maybe if something was provided for it, buyers would not question it.

Obviously, the floor plan is cost of doing business. Buyer have no feel for how the house lays out short of physically walking through it.

Pictures with the listing are often misleading. In reality, the house often shows significantly different than the pictures with the listing.

Sites such as Google and Bing do offer a number of options to 'drill down' and get better data.

Buyers will continue to demand more transparency in pricing and information provided by the LA. If the LA wishes to sell the house, they will provide it or wait along time until the 'greater fool' arrives.

[john schneider]

thanks Bruce, just one point about the SPDS & floor plans. If I had the best and most advanced real estate web site imaginable, there's still no way for me to offer SPDS or a floor plan on my site if the listing agents do not provide it and also load it properly into the mls. And these days, some agents are reluctant to spend the money for floor plans when they are less than optimistic about the chances of actually selling the house, and also after considering their diminished incomes and resources. Just the way it is.
JS

[bruce]

JS, you are right. The traditional real estate industry has failed to provide current and relevant information for buyers.

The internet has changed and challenged the mystery of pricing by listing agents and sellers. In economics 101, it is still supply and demand and a willing seller and a willing buyer agreeing on a price. The internet gives the buyer another tool to analyze home values in a market and decide what they are willing to pay.

In commenting on Zillow, I have found the same inconsistently in other markets, but it does hae some other features that make it worth viewing as buyer.

Another future blog might compare what Pima County has valued the house vs. the actual sales price. In some markets, the county valuations are very close to actual market value.

As a banker involved many years in real estate lending in AZ, it has always been facinating to observe how real estate appraisers vary in their estimates and struggle to find comparables. What truly is a comparable sale and how time specific should it be? What was paid in the peak is irrelevant in the valley of an overheated asset bubble.

Home buyers have the same dilemma. The more transparency in any market the greater power to the buyer.

The TARMLS move to flexmls may work fine for agents, but is a step backwards for internet saavy buyers. Also, most realtor web sites offer little value unless they contain access to floor plans and provide eletronically the SPDS and other relevant documents on the site for buyers to view.

Keep up the good work!

[john schneider]

Well it says something that a post on zillow valuations sets off this wide ranging and insightful discussion.
I think it was about 18 months ago that I did basically the same post and the few responses that did come in were simply
in support of what I'd said.
The other thing I'm hearing loud and clear is that you want more and better information and more control over your real estate dealings.
And that because the traditional real estate industry has failed to provide for the needs of today's savvy and sophisticated buyers
and sellers, zillow and other non-traditional services are flourishing. Is that right.

[PK Steffen]

The web has changed the role of the real estate agent but it hasn't made them obsolete by any means. Watch out for words like empowering - they really are just buzz words. I know - I have worked at the heart of the tech field for over 20 years.

Access to information aids buyers and sellers in making informed decisions but a web site can't replace the experience and knowledge of an agent. When buying our house, our agent showed us houses we might not have considered and ultimately proved invaluable when it came to negotiating and closing on the house we picked. You just can't substitute a web site for that kind of help.

[Stuart]

Just an aside...and not directly involved with this particular discussion of the merits of Zillow (or not!)...I found this discussion to be quite interesting. I also was quite impressed with not only the logic of each of the responders...Bobby and Jent in particular, but also their vocabulary.

J.S. your site must attract folk with IQ's in the upper quadrant of our society....
they truly know how to "talk the talk".

It is truly insightful for most of us to read the thoughtful remarks from some of those bloggers who choose to comment on your site.

[Bobby]

Much of what has been said about why Zillow is helpful is really commentary on the gradual movement toward disintermediation in real estate transactions. Real estate is one of the last markets to experience this inevitable consequence of the internet, and disintermediation is very threatening to real estate agents because they are merely intermediaries (i.e., "middle men") who can see the future coming and fear the eventual elimination of their positions and/or transformation of their overly lucrative compensation system to a non-commission based system in which they (like most everyone else) are paid only for the hours of work performed. Of course, the irony is that, although these agents are blind to the changing market conditions bearing down on their compensation system, they go on endlessly about how sellers fail to recognize the reality of the current real estate market.

Having now finished painting a target on my back, I am prepared for the deluge of nasty comments from real estate agents telling me all the ways they add value to transactions and why they deserve their fat fees. Fire away...

[PK]

That said - I think it is good that John is pointing out just far off the Zestimates are here. He is spot on as usual.

[PK]

I have to agree as a buyer, Zillow helped me with hard data points of what something had sold for and what houses around had sold for. Sometimes it was a big help, sometimes not much. But it gives you a window on the neighborhood if you've never been there. It's iPhone app was also much more functional than Long's mobile web page or pretty much any other MLS driven web site. I don't think I ever paid much attention to the Zestimate. I'd say many real estate sites could learn something from it's ease of use. So many are so difficult to use on a mobile that I'd rate them Web 0.5

[Jent]

What made me comment, was that you wondered aloud in your post script why Agents would associate themselves with Zillow, making it sound, to me, as if Zillow were a Pariah in the real estate world, and should be written off in its entirety.

What I wanted to convey was that the Zestimate Valuation was a miniscule, albeit highly visible, portion of the data and information Zillow has to offer. Obviously using the Zestimate valuation alone in home buying and selling decisions, in any market, is myopic.

The point I wanted to make in response to your query, was that I believe that agents associate with Zillow, and advertise there, because it harbors an active community of buyers and sellers seeking data, and it does so in a very localized fashion. In other words it is a very effective way for the average agent to easily and cheaply reach out to their target market. I believe it is much more effective, cheaper, and far less time consuming, than traditional marketing methods available to Agents.

Zillow will be around in the Foothills, and forge ahead, for years to come, and the Zestimate in that market, for the reasons discussed probably won't get any better. What will hopefully improve is the average Joe's understanding of the data presented therein, and increased transparency and dialogue as to exactly what factors do drive value in that portion of the Tucson market.

I believe Zillow is a very suitable place to conduct that dialogue.

[JD]

I use zillow all the time, but not for property valuations (as already noted, they are usually way off for high-end properties, but better for condos and track homes, though still not terribly accurate their either)

But the things I do tend to use zillow for are locating a home's precise location, quickly seeing the last sale price and date, and seeing how long a property has been on the market. And sometimes, different pictures than those that appear on every other website.

Again, even for the above purposes, zillow can be incredibly accurate or inaccurate depending on the metro area you're looking in, and sometimes vary greatly from neighborhood to neighborhood within a specific metro area. It's not a front line resource I use, but more an adjunct reference to check for further information on homes I've usually found elsewhere. From discussions I've had, I think a lot of people use it that way. It's just another easy to use resource, kind've like wikipedia, whose ease of use trumps it's accuracy value, kind've along the lines of the famous saying "trust but verify". I don't think I've ever asked an agent to take me to see a house that I hadn't checked out on at least 3 or more different real estate websites to get as full a picture as possible before investing the time for an in-person look-see...

[john schneider]

Thanks Jent,
But, btw, I fully realize that zillow is more accurate in more cookie cutter type areas. On the other hand, despite its lack of accurate data in the foothills, zillow just forges on.

And if I'm not mistaken, I only took issue with zillow's valuations in the foothills and not in other areas and not with the myriad and sundry other features that zillow has to offer. Just the valuations in the foothills. But thanks anyway for the lecture.

And though that may seem insignificant to you, it is of considerable importance to those of us who live in and are concerned about the foothills.
Imagine using that data to make your home buying or selling decisions.
Thanks,
JS