What Makes Zillow’s Estimates So Inaccurate?

Zestimates and other online home value calculators should be taken with a grain of salt. Here’s why.

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When I go on listing presentations, home sellers always ask me about the disparity between Zestimates and what homes actually sell for. Zillow will give their home a certain value, but the National Association of Realtors states that homes sell for 5% more or less than their Zestimate more than 67% of the time.

There are a couple main reasons why this happens. The first thing you have to understand about a Zestimate is that it’s an algorithm, or a formula-based estimation. It only calculates general information like the square footage of the house and the previous sales in that house’s particular zip code. As we know, houses are imperfect. Zillow doesn’t take into account things like the wear and tear from your kids or your pets.

Details play a huge part in a home’s true value. For example, in Silicon Valley, schools are a big factor in determining home prices. Two identical houses in Cupertino that are right across the street from each other could be as much as $200,000 apart in value just because one house is assigned to Lynbrook High School and the other is assigned to Monte Vista High School.

Zestimates should only be used as a guiding tool for pricing your home.

With all this factored in, it’s really important that you use Zestimates and other online calculators as merely a guiding tool. If you want to know the exact value of your house, you should ask a professional real estate agent who knows your neighborhood well.

If you need an estimate of your home’s value or you’re looking to buy or sell, don’t hesitate to get in touch with us. We’d be glad to help.

Should You Sell During the Spring and Summer?

When should you put your home on the market? It turns out spring and summer are great options for a couple reasons.

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When is the best time of year to sell your home?

Redfin, which is the largest real estate portal, has stated that homes sold in the spring and summer sell 9% faster and for 1.2% more money. There are a couple of reasons for that.

Spring and summer are great times to sell your home.

First, families that are looking to move want to wait until their kids are out of school. They don’t want to deal with the hassle of having to change school districts in the middle of the year, so selling during the spring and summer is ideal.

Second, interest rates are beginning to rise. Buyers are getting off the fence because they want to lock in the low interest rates that we have right now.

If you’re looking to buy or sell a home or if you have any other questions, feel free to give me a call or send me an email. I look forward to hearing from you!

3 Tips for a Smooth Escrow Process

When you sell a property, you can help yourself out in the escrow process by following these three steps.

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When you sell your house and get a ratified contract, taking these three steps will help you have a smooth escrow process:

1. Disclosures. As soon as the contract is ratified, the seller has to provide a certain amount of disclosures. The two most important ones that sellers should really take their time filling out are the seller supplemental checklist (which has to do with the seller's knowledge of all the items in the home) and the transfer disclosure statement, which outlines what is and isn't included in the property. Say you have a chandelier that's a family heirloom that won't be included with the house—you'd need to include that in the TDS.

2. Mortgage process. The appraisal is a big hurdle we need to get past. Typically, we want the appraisal to be at or above the purchase price so that the bank will approve the loan.

The title search ensures the property doesn't have any liens on it.

3. Closing. In the state of California, there are a lot of things we've got to make sure we pass clearly. The first item is the title search; we want to make sure we're up front and clear about any liens on the property or anything that would prevent us from giving a free and clear title to the buyer. Next comes title insurance, but if you work with our team, we take care of it ahead of time so you can be ahead of the curve. Then comes the funding part. About one or two days before the close of escrow, the bank will put the money into the escrow account, so you need to make sure this is done. Lastly, we have the final sign off. Schedule some time to sign off with the title team before you leave to celebrate selling your home.

If you have any questions about the escrow process or you're thinking about buying or selling a home in the Bay Area, give us a call or send us an email. We'd love to help you!