Searching Zillow for houses seems to have become an American pastime especially throughout the pandemic when people were looking for more space for a home office and a bit more breathing room to escape from screaming children, loud televisions, and even their pets, while being cooped up.
As an agent, I appreciate clients doing their homework, finding out what the market is bearing, and finding listings that represent the buyers’ desires. Oh, but that Zestimate… I’m probably not the first real estate agent to tell you these “zestimates'' are inaccurate at best, and downright deceptive at worst, but it’s true; if you’re relying on automated valuation models found on the internet by companies that have a vested interest in getting you to list and buy with them, you may find yourself mighty disappointed - zestipointed if you will.
Many people were tempted to have Zillow come and make an offer on their homes. When they saw what that “convenience” would cost, shock kicked in. Did you know their closing costs and fees were 8-12%? That is substantially more than a regular real estate sale. It’s hard to believe they lost money with that amount of customer fleecing.
However, after reporting losses of approximately $304 million in the 3rd quarter from their home buying segment, and a projection of another $240 million loss for the 4th quarter, Zillow decided to end their program altogether. If you’d like to read their announcement click here.
It’s no surprise to me that Zillow is closing down its “ibuying” platform. Shocking to no one but apparently Zillow themselves, buying properties at inflated prices and then selling them for a loss is not a winning business model. Further, they’ve even discussed how challenging it is to get an accurate “future sale” price in volatile markets which makes their zestimates a lot more like a guesstimate.
I will still encourage you to house hunt and dream (and let’s face it judge - who paints their kitchen green and red polka dots?) on Zillow. But when you want to know the value of your home, I offer a ‘bank grade’ Collateral Analytics tool along with a Comparative Market Analysis to accurately assess the value of the home. You MAY receive more than that value in this hot market due to the lack of inventory, but not because your home’s value zestfully grew.
If you’d like to know your home's current value, feel free to reach out.