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Zillow is a play on words. It is a mixture of the Zillions of data points underlying housing, combined with the word Pillow. The intent was to conjoin the analytical with emotion. Perhaps its a not so cool pun? I will leave that for you to decide.
What are Zestimates? How does it help to understand them as a buyer?
First, one needs to understand the Zestimate's cousin: Zillow's house market indicator, the Zillow Housing Value Index (ZHVI). Much like a property tax assessment, the goal of the ZHVI is to capture market trends. Zillow's ambitious goal is to capture this market momentum on a daily basis; which it accomplishes well in my opinion. ZHVI is a composite of all of the ZEstimates, making its purpose to serve as a macro economic indicator rather than an exact valuation. Now, with a understanding of the ZHVI, lets take a look at ZEstimate Error Rates
Knowing the error rate of a Zestimate helps a buyer evaluate a seller's home. Estimates typically need a human adjustment. Its hard to create an algorithm for what makes a house a desirable home. I council my buyers to ask other questions, how many views has the home had on the various websites, how many showings. Those are good anecdotal questions that can help guide the consumer.
Continued: Zillow Research/ZEstimates. How its useful to a buyer.
I could ask this question in almost any market in America: "Did you see last month's NewsPaper Headline about Median Sales price"? Well, there is a likely important qualifier to that article. All of the metrics are based on recent sales, which are usually reported by the local Realtor Association. Zillow has the flexibility to ascribe value to a larger range of variables than the Realtor Report does. If you believe in Zillow's Methodology (you can read about it here), a buyer can also see the projected growth of home values in an area through ZHVI. Should one adjust one's offer if the market is going up or down 10% in the next 12 months? Zillow helps with this decision.
So how does one find the ZHVI On the Zillow Home Page, hunt for this link;
While the first two selections are interesting, check out Zillow Research.
On this page, one can find their local state and municipality. Here is a linked report. The metrics below are not usually reported the same in MLS Realtor Reports.
One can see Foreclosures per 10,000 homes.
Negative Equity, this is the amount of people that are still underwater on their mortgage in a given area.
Market Peak. Check out North Whitehall, it hit an all time high during the time of this post.
Zillow Mortgage Tool. Click Here.
I, nor any consumer is a mortgage broker, but once pre-approved, and one has a rate provided to one, that person can see the relationship between taxes, loan amount, PMI, insurance and interest rate with this tool. I give no warranty to the accuracy of this calculator, use with the guidance of a mortgage rep.
Zillow Rent Vs Buyer Calculator: Click Here.
If you clicked above, you can see how your home build's equity over time. I think one point this chart does not incorporate is maintenance cost of the house VS the Interest Tax deduction. It also presumes no appreciation or depreciation of the home.
In Bethlehem Pa, it seems the pay pack period is 2 years.
Miselaneous parts of Zillow's Website.
Zillow has some other tools such as Zillow Digs (home design) and Porchlight (Their Blog).
What is a Pre-Foreclosure on Zillow.
I get this question a lot. A mortgage is a publicly recorded lien on a home. When a borrower is 3 months late on their mortgage, a bank can begin the foreclosure process on this person. Zillow has a foreclosure center (click here). So, Zillow attempts to report homes that have had the foreclosure process started on their address information at the courthouse. It can be an awkward situation, because sometimes this seems to get reported erroneously, other times the owner does not know its public record.
Here is what a pre-foreclosure looks like.
First you will see the address and the "Pre-Foreclosure" status.
Zillow attempts to keep track of the foreclosure record. You can call the law firm to see the status. My experience is that that the law firm working on the foreclosure is friendlier than the bank. It depends who you speak to of course.
Stephen L. Weinstein Realtor, Zillow Platinum Agent, PA License # RS316695. iLehighValley Real Estate. p:610-910-8444 m: 610-910-9342 w: www.iLehighValley.com e: Stephen@iLehighValley.com
