As a real estate investor, Zillow can be great and on-point when it comes to helping me close those BIG MONEY deals, but the website itself has been the demise of some of my deals! You can just picture me acting out a Loony-Toons cartoon, sitting on the sidewalk with a flower in my hand and I pluck each flower pedal saying...
"She loves me, she loves me not. She loves me, she loves me not..."
My friend Bill Gassett wrote an article called Are Zillow Home Value Estimates Accurate. As I began to consume the article, it stirred up so many emotions that I had to stop reading because I began to get upset. After taking a break, I would read, and then finally finish the blog post. The article just hit home as an investor, as it would with any other person who is involved in real estate that uses Zillow.
First of all, Zillow is an awesome tool. I actually use it pretty often because it gives so much great information about properties that is available to the public for free. Information such as the type of schools around the property, the home value, the amount of bathrooms and bedrooms for the property, and even the tax information on the house!
Folks, tax information is HHUUGGGEEE (in my Donald Trump voice). There has been a ton of deals where Zillow saved me a lot of time because I would put a house under contract only to find out that the seller was behind on tax payments. The seller of the property was unwilling to pay for the back taxes and thus I could not sale the property. If it doesn't pass the title company's title run, I don't want to do the deal if the seller isn't willing to cooperate. However, this isn't about back taxes! Let's continue.
I'm not going into super detail about Zillow because Bill Gassett already did such a great job explaining its uses in his article, but I personally use this online tool for a lot of things. It is one of the first places I go to when considering putting a contract down on a prospective seller's property. Up until recently, the property value has been rarely been close to what it is actually worth. On that same note, it gives me a ballpark of about a $20,000 gap for an estimation. I then will check the results with Total View Real Estate to verify my findings because it is a very thorough resource that remains free at the time.
You can't go wrong with a realtor
I can do as much research as I want to, but after I do my own research, I ask my realtor friend for his help. I don't have access to the MLS, but I don't need it because I have my friend. If you're an investor and you say that you don't need to know any realtors, I'd laugh and say you're crazy (unless you're an investor with a realtor license.)! Realtors are monumental to home estimations. If you're an investor in need of a realtor in the Massachusetts region, make sure you click here to contact Bill Gassett.
The information from the MLS and the realtor should solidify your research so that you can make a proper offer on the seller's property. See, sometimes on Zillow, you're not able to see all of the most recently sold properties in the desired area so you can make that solid offer to the seller. In spring of 2016, I had a scenario where someone wanted me to make an offer. The house was beat up, and it was on a corner-lot in an up and coming areas. The seller wanted $50k, and there was no way I was making that offer.
My good friend Zillow didn't show any recently sold comps to help me on my lower offer. I then contacted my realtor friend to pull some comps for me and whatta-ya-know...there was a property right down the street that was in the same shape, with the same amount of bedrooms and bathrooms that only sold for $20k a few months earlier. I came back and offer the guy $18k. He looked at my facts (because I showed him the comps), and he had no choice but to agree. The ARV in that area showed upward to $90k. Imagine the spread on that flip!!!!
I hope you're understanding my heartbreaking love-hate relationship with Zillow. If you say that you don't like the platform that is understandable as well. To each is his own. But for me and my house...we will use Zillow as a buffer and a checkup just to get a baseline of expectations. I'm extremely thorough when it comes to my research. The numbers do not lie. Even when the numbers seem to lie, your mistakes are greatly minimized if you do your due diligence.
I'm a professional real estate coach and I have helped many over the phone, 1on1. Many of the beginners try to skip steps and I warn them to not do it. I have been in their shoes because I too was at a point where I was desperate to close my first deal. It never ends well when steps are skipped. If you choose to use Zillow, follow it up with more due diligence. It can't do anything but help you in your endeavors. Plus, you can find buyers, and other properties that aren’t on the MLS, but that is another story:) Til next time...
Please help me by pinning this to Pinterest by
clicking "Pin It" on the picture below: