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Zillow vs. Redfin vs. Realtor: Why Do Home Value Estimates Differ So Wildly?
By Leslie Cook MONEY RESEARCH COLLECTIVE
How accurate are Zillow ‘Zestimates,’ really?
How much is your house worth? In an age where you can look up just about anything on the internet, homeowners — and prospective buyers — have grown accustomed to relying on sites like Zillow.com and Realtor.com to answer that question. Problem is, if you compare prices on multiple online estimators, you sometimes get conflicting figures.
We asked real estate expert Bianca D’Alessio why the home values listed on different websites are sometimes at odds with each other, and how home buyers and sellers should interpret the estimates they find online.
Here’s what she said.
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View RatesBoth Zillow and Realtor utilize different valuation algorithms, data sources and update frequencies for their property listings. Realtor.com heavily relies on MLS data and public records, whereas Zillow integrates user-submitted information and broader market trends. Each platform may also interpret local market conditions differently, resulting in varying property value estimates.
Relying solely on the valuation systems provided by Zillow and Realtor.com is not comprehensive or entirely accurate for pricing a property. These platforms often do not adequately consider specific property attributes such as how it compares to existing inventory, value-added enhancements like cosmetic upgrades, or the emotional response that buyers may have in the current market.
To simplify, two apartments could be identical in layout and size. On Zillow and Trulia both could have the same valuation. However, one may be on the front side of the building, looking over a cherry blossom tree and the other towards the back of another building looking at a brick wall. While in theory, they are the “same apartment” a buyer visiting both properties will have a very different emotional response to each of these apartments. Their value is not the same. A buyer will respond better and will pay more for the front cherry blossom, sun-filled apartment, than they will for the back-facing home that looks at a brick wall.
Using the same example, one of the apartments may have experienced extreme wear and tear from the prior owner while the other has been kept in perfect condition, or even nominal cosmetic enhancements, such as new appliances, regrouted bathrooms or even staging furniture. While both homes will continue to be valued the same on listing platforms, these enhancements – even if minor – will be better received by the marketplace and the home will transact for a much higher price.
Other factors like inventory levels, buyer sentiment, interest rates, renovation costs and numerous other economic influences significantly impact how buyers perceive a property’s value and where it should be priced in a given market. The only way to get an accurate understanding of your home’s value is to hire a licensed real estate agent to conduct a comparative market analysis. This analysis considers real-time micro and macroeconomic data and employs a strategic pricing and marketing approach to align with market conditions.
Attempting to estimate a property’s value without getting a professional’s opinion risks undervaluing the property or missing opportunities to maximize its sale price.
Leslie Cook is Money's lead real estate editor, covering news stories about mortgages and how rate movements affect the housing market and writing and editing stories that inform our readers about real estate trends and how they affect homebuyers and sellers. Leslie writes a weekly newsletter, Money Moves, that covers a wide range of real estate topics in addition to her weekly articles. Her work has been featured on Apple News, MSN and ConsumersAdvocate.org. Leslie has been covering the mortgage and real estate industry at Money since 2019 and has interviewed industry leaders, such as Lawrence Yun, chief economist at the National Association of Realtors, and Glenn Kelman, CEO of brokerage Redfin. She has been a guest on the This Morning with Gordon Deal radio show, interviewed by The Mortgage Note, and served as moderator for ServiceLink’s State of Homebuying webinar. While at Money, Leslie has contributed to several of Money’s rating and ranking features, including Best Places to Live, Best Places to Travel and Changemakers. She has also played a major role in researching and selecting Money’s Best Banks rankings for the past four years. Before joining Money as a staff writer, Leslie was a reporter for Caribbean Business Newspaper in San Juan, Puerto Rico, covering human resources, telecommunications and computers. She graduated cum laude from Bryn Mawr College in Pennsylvania with a bachelor’s degree in history. The research and interviewing skills learned there have contributed to Leslie’s ability to provide accurate information on her area of expertise and elicit informative responses from her interviewees.