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Fill In The Blank: Your Home Is Worth $ _______

Have you seen those sites or apps that promise to tell you the value of your home with one click? You know the kind: “Click here to get your home value instantly!” Chances are you’ve seen or used a Automated Valuation Model (AVM) before but may not be familiar with the terminology. AVM’s are commonly found in website banner ads, social media posts, or many different REALTOR or real estate brokerage websites. They use mathematical modeling combined with a database of comparable properties. But are they accurate?

How are they calculated?

Often times, they rely on publicly available data that can be “scraped” online and fed into proprietary formulas. One well-known website’s disclaimer warns their calculation is

computed using a proprietary formula. It is not an appraisal. It is a starting point in determining a home’s value […] calculated from public and user-submitted data, taking into account special features, location, and market conditions.“

So are they accurate? 

source: https://www.zillow.com/zestimate

It depends. Though they don’t claim to be totally accurate, Utah offers additional challenges. In our state, data about sold homes is not released to the general public from the local Multiple Listing Service (MLS). This information can be obtained by hand by homeowner or a real estate professional, but even then, it’s often found to be incorrect because it’s not verified for accuracy. Because of the limited feed, online marketplaces rely on user input and antiquated county records for additional information making Utah results in AVMs less reliable than other markets, and one of the most inaccurate in the nation. 

 Our take: 

What about things like location, condition, upgrades or after repair values? What if you are planning to or just had a renovation? Does your home have a view? Extensive landscaping? Does it have physical location obstacles? What about niche markets like SunCrest that behave (and are valued) differently than others just a few miles away? These items are just a few of the many factors that AVMs just can’t take into account. Currently, only two brokerages in Utah have a direct feed from the MLS, Windermere Real Estate being one of them. This proprietary feed, in addition regularly statistical analysis, continuing education and industry involvement help us stay focused on our niche market.

Our SunCrest Market Update is a hyper-local analysis of the most up-to-date information regarding the SunCrest real estate market.  The previous month’s SunCrest housing information and future editions are released monthly.