Thursday, September 07, 2006

Zillow Pumps Up Values With No Explanation - Are The Trying To Buy Our Confidence?

It's common knowledge in the real estate business that flattery toward owners/sellers will get you everywhere.
Well, Zillow is getting into the game in a big way. While the complaint has been that their "zestimates" have been off, usually under-zestimated by anywhere from 30% - 100% here in the Hamptons, all of a sudden it appears that values in the Hamptons are rising (according to Zillow) at a neck-breaking pace!

Look at the following graphs. All three are different houses in different areas in the Hamptons. All three, according to Zillow, have seen miraculous increases in zestimates in the last several months - RETROACTIVELY!!!

$4.8M - $6.6M in 4 months.

$700k - $950k in 4 months.

$624k to $784k in 6 months.

According to the statistics that I have received from locally-reliable sources like Long Island Profiles and Suffolk Research, values have not gone up 25-35% across the board in the Hamptons this spring/summer. I imagine that Zillow hopes this will get more people to use their site to make buying and selling decisions.

The Zillow numbers are as unreliable today as they were 6 months ago, even if they are more flattering to the homeowner. md


jfsellsius said...

Those are very interesting stats Michael. Perhaps it is due to the delay in sales data getting recorded in the public record in New York. My experience has seen up to 8 months delay in recording of deeds & sales transfer docs. So it may very well be that zillow figures are showing a time lag.
It would be interesting to track these zestimates from week to week to see any variances up or down over several weeks.

Michael Daly said...

Yes, there are delays in reporting sales from Suffolk County and there always has been. But, those delays are consistent and have no impact on the unexplicable across-the-board increase in zillows valuations. It appears to have been done manually to buy favor from the complaining masses. How disingenuious!