One topic that comes up frequently when talking to people about home values is the accuracy of the homes values you find on the internet… you know the ones I’m talking about: Zillow, Redfin and others. I usually find myself explaining how those websites calculate the value and how most of the time you can’t trust them. But today I want to share with you a recent experience I had to illustrate to you how wrong they can be:
I got a call from a family friend who is interested in selling a property, so I set up an appointment to view the property and talk with the client. Before my appointment I pulled up the property information and reviewed comparable properties that are currently on the market as well as others that are pending and have recently sold. I also pulled up the property on a few websites that offer value estimates. Let me be clear- I do not use these estimates to help me determine a value, but rather because I know that 99% of the time clients have already looked at these sites and I want to be prepared for them to bring this up during our discussion. Here is a rundown of what I found:
The tax assessed value for this property in Felida is $348,000 for 2017.
Zillow’s Zestimate: $632,000
Redfin’s value: $386,000
How could they be so different? Short answer> they aren’t accurate!!
After reviewing the comps with my client and talking to them about how the location, condition and curb appeal will effect the sale of the property, I let them know what my opinion was and we came up with a number in the $400,000’s.
Bottom line, a home is worth as much as someone is willing to pay. But if you really want an accurate estimate of your home’s value, or the value of a home that you are thinking about buying I would STRONGLY suggest that you talk to me or another expert on local real estate.
Stay tuned! I will update you on what the real value of the home is once we get it sold.
When chatting with people about real estate the conversation commonly finds it’s way to “The Bubble.” Many people are concerned about rising values of homes and think that it indicates we are on our way to another bubble. When I found this chart I knew I had to share it, as it is very helpful in explaining where current home values are:This graph shows what home values would be in a normal/stable market; this is represented in white. The black bars show what home values actually were over the last 16 years. As you can see, even though home values have been rising the last 4 years, we are still below where values would have been if there never was a bubble and burst. Due to this, many experts believe we are not headed towards another bubble.
In Clark County we also have other economic factors that help support our home values rising, including a growing job market, low inventory, as well as overall more affordability as compared to other metro areas along the West Coast.
I hope this was helpful. If you have any questions, please call me!