Has Zillow gotten more accurate predicting Sacramento Home Values? The answer is here...

If you have been reading my blog for a while, then you probably already know that I usually get a chill down my spine when one of my clients mentions "the Z word." What's the Z word? Zillow. What is Zillow? Zillow.com is a website that, among other things, provides information about neighborhoods and properties.

Zillow is a neat website. I have an agent profile on Zillow. I have clients who have found me using Zillow. However, my general thought about Zillow is that while it's a fun consumer tool that provides property information to people looking to buy or sell (or even rent property now), the vast majority of the time, the "Zestimate" (aka, the value that the website dreams up for a certain property), is usually not close to the market value of a Sacramento area property, and the homes listed for sale on the website are not current.

I posted a few times last year about how the sales prices of my transactions compare to Zillow data. I've closed a total of 7 transactions so far in 2014 between Janurary and February, so let's take a look to see how close Zillow is to the actual selling prices of these properties. This information is CURRENT as of today, March 6, 2014.

3715 Tallyho Drive #12, Sacramento, CA 95826; this was a condo I listed (represented the seller in a short sale) in Rosemont. The original listing price was $85,000, and this sold on 1/10/14 for $80,000. Zillow's Zestimate: $145,681. YIKES -- approximately 71.39% above it's selling price. WOW. Something is way off here.

1433 Sebastian Way, Sacramento, CA 95864; this was a home I sold (represented the buyer) in the Arden area. The original listing price was $215,000, and this sold on 1/10/14 for $215,000. Zillow's Zestimate: $178,000 -- approximately 17.21% below it's selling price.

213 Muckross Abbey Court, Lincoln, CA 95648; this was a home I sold (represented the buyer) near in Twelve Bridges Lincoln. The original listing price was $349,900, and this sold on 2/6/14 for $361,500. Zillow's Zestimate: $341,000 -- approximately 5.67% below it's selling price.

2237 Eastwood Drive, Roseville, CA 95747; this was a home I listed (represented the seller) near in the Fiddyment Farms area in Roseville. The original listing price was $459,900, and this sold on 2/25/14 for $460,000. Zillow's Zestimate: $437,610 -- approximately 4.87% below it's selling price.

8238 Leesburg Way, Elk Grove, CA 95624; this was a home I sold (represented the buyer) near Monterey Trail High School in Elk Grove. The original listing price was $250,000, and this sold on 2/28/14 for $245,000. Zillow's Zestimate: $220,000 -- approximately 10.2% below it's selling price.

4900 Sir Henry Court, Fair Oaks, CA 95628; this was a home I sold (represented the buyer) near Miller Park in Fair Oaks. The original listing price was $739,900, and this sold on 2/28/14 for $719,000. Zillow's Zestimate: $680,000 -- approximately 5.42% below it's selling price.

2656 Harkness Street, Sacramento, CA 95818; this was a home I listed (represented the seller) in Land Park. The original listing price was $275,000, and this sold on 3/5/14 for $280,000. Zillow's Zestimate: $273,000 -- approximately 2.5% below it's selling price.

I have said it before and I will say it again...I think two conclusions can be drawn from the information above. First, Zestimates are generally not accurate. They don't take into consideration property features that can not be quantified. Is it on a main street, is it near a park, was the kitchen remodeled, have unique architectural features...? Second, our dynamic Sacramento area real estate market is now increasing in value, and Zillow has a long way to go to catch up to pricing these trends and factoring them into their mathematical equations that determine these values. But it is still a fun website for entertainment purposes.