- This topic has 14 replies, 9 voices, and was last updated 18 years, 1 month ago by PerryChase.
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October 30, 2006 at 9:27 AM #7801October 30, 2006 at 9:39 AM #38765ChrispyParticipant
Zillow calls them zestimates for a reason – it is not a firm number, but a range. I agree, the zestimates are sometimes wrong, but more often they overvalue a house rather than undervalue it. As far as posting what the owner (s) have paid and how often the house has been sold, I think Zillow does a good job.
Zillow is not perfect, but combined with county records we have a better picture of what’s going on out there.
Heaven help us all if we have to go back to depending on what agents have to say. We need more transparency in RE, not the vagueness and deceit that we’ve had in years past. I wonder if this NCRC group has ties with NAR?
October 30, 2006 at 9:52 AM #38766PDParticipantZillow makes information available to the consumer. The only people hurt by zillow are those people (realtors, etc) who used to have a lock on information.
October 30, 2006 at 11:22 AM #38770sdrealtorParticipantI disagree and think it’s great that Zillow make sinformation available to consumers. What I dont think is great is the Zestimate which is very arbitrary. Provide tax information, sale information, comps etc. It’s all good. But estimating the value of a home you have never seen and comparing it against comps that you have never seen is a complete disservice to the consumer.
October 30, 2006 at 12:40 PM #38773ChrispyParticipantWhy should Zillow be any better than the appraisers who did drive-by appraisals in the past two years? They, too, have never seen the houses, unless only the facade in the front counts.
And we paid for those mock appraisals too – unlike Zillow, which is free.
October 30, 2006 at 1:10 PM #38774sdrealtorParticipantApples and oranges. You didnt pay for the “mock appraisals” the borrower did. Appraisals arent estimating market value they are justifying a loan based upon other comparable sales. At least the appraisers saw the house. They saw what was next door, they saw if there are powerlines overhead or a busy street behind it. They saw the condition of the property relative to the comps.
Zillow on the otherhand is trying to provide estimates of market value. It is very very misleading. I love that they provide legitimate data points but trying to estimate value is a step beyond what they should do. Sales history, recent sales etc all empower the consumer to ask good questions and evaluate market value. OTOH, Arbitrary estimates based upon inaccurate data serve no purpose.
October 30, 2006 at 2:29 PM #38777ChrispyParticipantI was the borrower so I did pay for the “appraisal,” as did many others who paid for a five-minute drive-by. The appraiser did not see the gopher-populated backyard. He also missed the pitted and dinged hardwood floors, which were scratched with what looked to a dagger-like tool whilst the scratcher was on crystal.
I’d say appraisers miss 85% of the house by depending just on the front and what is in the neighborhood. That said, I think we will be returning to the old-fashioned way of a walk-through in times to come.
October 30, 2006 at 2:55 PM #38778guitar187ParticipantYou are a borrower that paid for a supposedly “useless” drive-by appraisal. By chance did you compare the rate you obtained to lenders that did not require the drive-by?
Fannie/Freddie allowed a 2055 in lieu of a full appraisal. That is to your benefit. In my eyes you obtained a conventional rate with a discount appraisal fee. What’s the problem? Had you gone to a non-convetional product you would have paid a higher rate. The increased rate would cost you more than the drive-by appraisal fee.
October 30, 2006 at 2:55 PM #38779sdappraiserParticipantWhat are you saying?
You scratched up your floors during a crystal binge and you are mad at the appraiser who didn’t go inside when you needed to cash-out refi for more crank?
Or you purchased a house with deferred maintenance and were too cheap to hire your own appraiser to conduct a full appraisal to verify your offering price was reasonable?
You really have no idea what appraisers do, and in general are clueless about much of what you post about. Some of your more recent postings have been really dopey.
October 30, 2006 at 5:05 PM #38783CritterParticipantChrispy may be dopey, but you’re grumpy. Rather than name-calling, how about telling us what makes a good appraiser? There seems to be some confusion as to what value a good appraiser brings to the table, and the mediocre ones in the past have helped bring down the quality of your profession.
So, instead of pointing out Chrispy’s many defects, please tell us what we need to know about your attributes.
October 30, 2006 at 5:23 PM #38785BugsParticipantThe main thing you folks want to remember about appraisals prepared for mortgage lending is that the beneficiary of those appraisals is the lender whose money is being used to finance the mortgage. These appraisals are not being developed for the buyer to verify their purchase decision or for the loan originator to close a deal.
I say that by way of explaining that the decision of what type of inspection process is used to develop the appraisal originates at the lender. The big lenders use automated underwriting systems that recommend which types of appraisals to use for the different mortgage programs. Other lenders manually underwirte their loans and come up with similar criteria for which loan applications need a more thorough appraisal and which ones don’t. This is another expression of risk management, which is the current buzzword among lenders.
For example, if the borrower’s credit is good and the loan-to-value ratio being sought is below a certain point (like 80% of a purchase price), these lenders don’t see any added value in spending the extra $50 to have the appraiser physically measure the structure and conduct an interior inspection. It’s the lenders’ money and therefore it’s basically their call. The only exception is that the appraiser is SUPPOSED to be able to retain the right to bump the process up to the more thorough inspection if they think it’s necessary. That said, the appraisers usually don’t get paid additional if they exercise that discretion; and they are usually discouraged from exercising the discretion because it tends to slow down the process.
An appraiser will often insist on increasing their process to include an interior inspection if they suspect there are problems with the interior or if the size of the structure obviously doesn’t jibe with the information in their public records sources. Another reason would be if the borrower has mentioned recent interior upgrades that would affect the value. In other words, if they think they have a reason to do so they are supposed to do it.
It’s a given that an appraisal with no interior inspection requires the appraiser to make an assumption about the quality and condition of the interior; most appraisers assume the interior is consistent with what they see on the exterior. The fact that the appraisers are making that additional assumption is included in those reports, along with the appropriate notification that if that assumption proves to be incorrect it would probably have an effect on their value conclusion.
October 30, 2006 at 5:54 PM #38787CritterParticipantBugs – great info. Thorough, logical, and stated in a way that laypeople can understand. I appreciate your posts.
October 30, 2006 at 7:11 PM #38795BugsParticipantIncidentally, I think Zillow is just one of what will eventually be a number of such programs, and those programs will improve as time progresses. How useful Zillow is to people will depend on how they use it. If they’re using it solely to get a Zestimate then they’re not going to be happy at all because of the inherent limitations.
The cool thing about Zillow is that it provides a portal to the data that hasn’t been as readily available before. As with most data sources the trick has always been to figure out how to use the data.
October 30, 2006 at 8:48 PM #38801sdrealtorParticipantBugs,
My point exactly. Its great that they make the data readily available. The Zestimate is not data and is very inaccurate. the rest of it is great.SDR
October 30, 2006 at 8:48 PM #38802PerryChaseParticipantI find that Bugs speaks with experience and fair mindedness. A great real estate professional in my view.
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