by Adrian Amos
The Wall Street Journal reports that Internet home value services like on Zillow and Trulia can be 20% to 50% higher or lower than eventual sales prices. And since these online services have gained in popularity, consumers have used the estimates as factual basis for accepting offers, refinancing and remodeling decisions. Which hasn’t always worked in their favor.
The sites make estimates based on algorithms and collected data, but as WSJ contributor Alyssa Abkowitz reports, that doesn’t ensure accuracy:
“Appraisers and real-estate consultants say the online models can veer off target with alarming frequency. Most data for the models come from two sources: records from tax assessors and listing data for recent sales. Collection is a challenge, however, because not every county tracks properties the same way—some calculate home size by number of bedrooms, others by overall square footage. And automated models aren’t designed to account for the unique construction details that often make or break a deal, or for intangible factors like a neighborhood’s gentrification.”
HomesAndLand.com also has a home valuation tool, which advises consumers that it is not an actual appraisal and states: “Determining the most accurate home prices is best left up to a real estate professional.”