Loading ...I recently went to Zillow.com to find a “zestimate” for a home in The Preserve area of Pleasanton. For those not familiar with The Preserve, it is a high end subdivision of approximately 100 homes nestled in the hills of West Pleasanton, surrounded by acres of open space and ridgelands. It has always been a very popular neighborhood because of it’s scenic quality and convenient location.
Anyway, the home I checked was over 4000 sq ft, and the “Zestimate” came in at around $1,575,000, which is easily $200,00 or more less than it’s probable value today. I was shocked that it was so low, since the last sale in the neighborhood was $2,175,000. And there is a new home in Kolb Ranch Estates, which is in The Preserve, that just sold for $2,530,000, and it is approx 4500 sq ft. Now, one key point is that The Preserve is on the norther border of Pleasanton, and Dublin is just on the other side of I-580.
Low and behold, the Zillow estimate used comparable sales from Dublin to arrive at the “Zestimate”. Anyone who is in real estate, or has more than a passing interest in Pleasanton real estate, this is “Ztupid”. Pleasanton homes, especially on the high end, command much higher prices than Dublin homes do. In fairness to Zillow, they don’t claim to provide appraisals, and they recognize that there are flaws in their algorithm.
This is just another illustration that while Zillow.com is a fun site to visit, and a good source of conversation, it is a mathematical guess, and not the same as an appraisal, as many of the determinates of value (view, upgrades, neighborhood differences) are not easily quantifiable. Zillow works better with cookie-cutter subdivisions without variances in view, location, and lot size. I have seen several buyers use Zillow as a bible, and put faith in it’s ability to accurately predict the value of a home. And I have seen several scenarios where Zillow has been off, sometimes way off. I recently had a house in Fremont that Zillow pegged the value at $1,100,000. It sold and closed for $1,500,000. It was a custom home with a large, private lot, and it was surrounded by smaller, less expensive homes. Not even close.
So be careful about putting too much faith in Zillow and other online valuation tools, and get some input from an experienced, professional real estate agent who can show you comparable sales that are actually relevant. It’s only your money…..
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