SunCrest Market Updates November 29, 2021

November SunCrest Market Update

How Accurate Are Instant Online Home Estimates?
You’ve seen them before. “Click here to see how much your home is worth!” Websites like Zillow offer instant appraisals but how accurate are they? As it turns out, not very. For several years, Zillow had been buying up properties all over the nation. However, they recently shut down that whole side of their businesses because, after relying on their own computer generated forecasting and automated valuation modeling of homes, they were overpaying for homes throughout the country at breakneck speed. In short, their own “Zestimate” technology failed them.

The Problem With Online Appraisals
Companies like Zillow don’t have access to all the information. Utah is a “non disclosure state” which means that information about homes that are sold is not released to the public. Because of this data and privacy restriction, online marketplaces must lean on unreliable user-submitted data and antiquated county records for additional information. Zillow reports their national median error (aka “How accurate are we?”) is nearly 7%, but Utah is one of the most inaccurate states when it comes to online evaluations of real estate because of the lack of data.

How To Accurately Determine A Home’s Worth
When Zillow shut down their homebuying program, it was a clear signal that technology and algorithms can’t replace local knowledge. Online evaluations can’t fully take into account great locations, home condition, upgrades, or new repairs. They don’t know the story behind upcoming renovations, highly sought after views, or best-on-block landscaping. Technology struggles to take into account niche markets like SunCrest that behave and are valued differently than homes just a mile away. For all of these considerations, there’s no substitute for experience and personal expertise. While technology is a key piece of assessing how much a home is worth, there’s no replacement for hyperlocal human expertise. When buying or selling your most important and valuable investment, don’t partner with a computer. Hiring a seasoned professional will help you get the right evaluation, save time and money, reduce stress, and help you navigate the complexities of the ever changing market.