Zillow is now buying houses. This poses a very important question…
Will Zillow pay the property owner their “zestimate” which is what Zillow believes the property owners home is worth?
Absolutely not, if they do, then they will go out of business.
Allow me to state the obvious. The only reason Zillow is buying houses is to make money, and to make money, they have to buy the house below actual value.
The exception would be if Zillow’s “Zestimate” (aka Zillow’s logarithmic property US dollar value estimate) is significantly under valued, which it sometimes is, but more often than not, their “Zestimates” are much higher than the actual value of the property.
Next Question: Is this a conflict of interest for Zillow?
Answer: Yes, it is definitely a conflict of interest for Zillow to buy your home when their business is to provide unbiased and neutral 3rd Party property evaluations.
So what Zillow is now saying to property owners: Hi come to our website see what your property is worth, but we could never pay you that.
Slowly but surely, if Zillow continues to do this people will lose faith in their ability to provide reliable data.
Zillow is out to make as much money as possible, and I would be all for it, if they provided as much value as possible. So what does Zillow do well at?
What Zillow does well:
Provides the public with recently sold properties near the property being evaluated (which is one of the best ways to determine the value of a property)
They have an amazing brand with an amazing internet presence….which allows them to market to real estate agents who pay them hefty sums to provide them with potential buyer and seller leads.
What Zillow does not do well:
Provide accurate property values to property owners.
Summary: Do not rely on Zillow, talk to at least three real estate agents who can show you their own proven successful property sales.
Every agent has a number that can be inputed into the MLS(multiple listing service), have them show you their number and show you all their sales before you trust them with one of the most important financial decisions that you can make!
Have you got a recent “Zestimate”? If so, then please let me know if you think it was low, high, or about accurate…I would love to know!
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-Curt and Kim C
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