Pricing on Real Estate Marketplaces
Nowadays, potential home buyers and sellers – especially tech-savvy generations – are using online real estate marketplaces. One of the key factors in a housing search is the price tag, which is why the value estimates on these platforms are essential.
The Zestimate feature on Zillow is one pricing tool that gets the basics right and makes housing financials easier for users. Let’s take a closer look at what Zestimates are and how they’re transforming the online real estate marketplace.
All about Zestimates
What are Zestimates?
Zestimates show up on every Zillow house listing. Basically, it’s the estimated market value for the house. It’s an at-a-glance way to get an approximate figure. It’s absolutely not an official appraisal price.
How does Zillow determine Zestimates?
Zillow uses its own proprietary formula to create a Zestimate. A variety of house facts make up this formula. That means the more up-to-date the house listing is, the more accurate the Zestimate may become. This may not be automatic. For example, if you’ve made a home improvement and include this house fact on the listing, the Zestimate may not instantly update.
Are Zestimates accurate?
Zestimates are designed to be a starting point for discussing price. Zillow has published figures on the accuracy of Zestimates. According to these statistics, Zestimates have a 1.9% median error rate, while off-market homes have a 7.5% median error rate.
The range of error may vary widely depending on the location and availability of data. For example, if Zillow doesn’t have much data on local market conditions in a specific city, their error rate may be much higher.
Is Zillow Offer the same thing as Zestimates?
No, Zillow Offer is an official purchase amount, while Zestimate is an unofficial estimate. Zillow Offer uses a combination of market trends and an in-home evaluation to determine the price.
How Zillow simplifies housing financials for users?
Getting an accurate and fair estimate of a house’s market value can be a challenge. It’s especially difficult for users who want a quick look while searching in a database of potential future homes.
Oftentimes the price users can see is set by the seller, which may be inflated. Zestimates turns the tables and makes the process a bit more balanced. Because the Zestimate is an independent price estimator, users may get a better sense of the house’s market value.
The Zestimate also makes it easy to filter search results. Users can click on a variety of different filter options, including the Zestimate. Overall, Zillow is a good real estate site for inspiration, as it avoids many of the common customer complaints about real estate sites.
Why your real estate site should have estimates and filters
The better user experience, the more successful your real estate website will be. That’s why you should consider adding plenty of advanced filters to wow your potential clients. You might even include a fun favoriting tool so users can save the listings they like.
Estimates are especially important for users to help them gauge the price. Of course, a margin of error is inevitable, but the estimate is great for getting started on a house hunt. Your users will appreciate having this ballpark figure on hand as they look for their dream home.
Looking to add more filters to your real estate website? Get in touch with the Onsharp team for a personalized quote.