Zillow vs. cyberhomes. WTH happened to Zillow?

[profhoff]

Zillow’s algorithm is fundamentally flawed. Since they the goal is to monetize Zillow and since consumers think the estimates have validity, this is one heck of a problem.

We’ve been tracking some bizarre Zestimates and the Internet is awash in complaints that Zillow estimates that are too high, too low, or dropping/rising too quickly.

Take your pick!

Zillow flaks (currently David G.) are quick to show up when a new post appears criticizing Zillow, but much slower to proffer any reasonable explanations of the discrepancies. Indeed, they’ve yet to offer anything even remotely resembling a reasonable explanation.

The problem, in my opinion, is not that the model is flawed, but that the algorithm is a black box and consumers use these data as significant inputs for decision making.

The problem is compounded when Zillow justifies the errors by in effect saying, what’s the big deal? people don’t use these numbers anyway.

Sorry, but a profit-making concern can’t have it both ways.

Zillow needs to get better fast or suffer the consequences.

See this thread for a brief discussion of what I consider to be astonishing errors for three model matches very near each other and Zillow’s lame explanation.

What do you think?

[Daniel]

Very nice link. That example is in perfect agreement with what I have witnessed in my neighborhood (see a few posts above). Precisely the same problem. Two houses that are identical, were valued nearly the same a year or two ago, and are apart by more than $200K now.

I offered an explanation for the discrepancy (maybe Zillow 2.0 gives too much weight to prices of nearby houses). That’s really the only way I can wrap my mind around this. Everything else (lot sizes, year built, etc) is the same and can’t account for the difference.

Yes, Zillow’s got a bit of a problem. To be fair to them, what they want to do (produce an accurate estimate on each and every house) is very hard work. Close to impossible. In contrast, the Case-Shiller algorithm is a piece of cake. They average over an entire metropolitan area, kinda hard to get that wrong.

[Daniel]

Very nice link. That example is in perfect agreement with what I have witnessed in my neighborhood (see a few posts above). Precisely the same problem. Two houses that are identical, were valued nearly the same a year or two ago, and are apart by more than $200K now.

I offered an explanation for the discrepancy (maybe Zillow 2.0 gives too much weight to prices of nearby houses). That’s really the only way I can wrap my mind around this. Everything else (lot sizes, year built, etc) is the same and can’t account for the difference.

Yes, Zillow’s got a bit of a problem. To be fair to them, what they want to do (produce an accurate estimate on each and every house) is very hard work. Close to impossible. In contrast, the Case-Shiller algorithm is a piece of cake. They average over an entire metropolitan area, kinda hard to get that wrong.

[Daniel]

Very nice link. That example is in perfect agreement with what I have witnessed in my neighborhood (see a few posts above). Precisely the same problem. Two houses that are identical, were valued nearly the same a year or two ago, and are apart by more than $200K now.

I offered an explanation for the discrepancy (maybe Zillow 2.0 gives too much weight to prices of nearby houses). That’s really the only way I can wrap my mind around this. Everything else (lot sizes, year built, etc) is the same and can’t account for the difference.

Yes, Zillow’s got a bit of a problem. To be fair to them, what they want to do (produce an accurate estimate on each and every house) is very hard work. Close to impossible. In contrast, the Case-Shiller algorithm is a piece of cake. They average over an entire metropolitan area, kinda hard to get that wrong.

[Daniel]

Very nice link. That example is in perfect agreement with what I have witnessed in my neighborhood (see a few posts above). Precisely the same problem. Two houses that are identical, were valued nearly the same a year or two ago, and are apart by more than $200K now.

I offered an explanation for the discrepancy (maybe Zillow 2.0 gives too much weight to prices of nearby houses). That’s really the only way I can wrap my mind around this. Everything else (lot sizes, year built, etc) is the same and can’t account for the difference.

Yes, Zillow’s got a bit of a problem. To be fair to them, what they want to do (produce an accurate estimate on each and every house) is very hard work. Close to impossible. In contrast, the Case-Shiller algorithm is a piece of cake. They average over an entire metropolitan area, kinda hard to get that wrong.

[Daniel]

Very nice link. That example is in perfect agreement with what I have witnessed in my neighborhood (see a few posts above). Precisely the same problem. Two houses that are identical, were valued nearly the same a year or two ago, and are apart by more than $200K now.

I offered an explanation for the discrepancy (maybe Zillow 2.0 gives too much weight to prices of nearby houses). That’s really the only way I can wrap my mind around this. Everything else (lot sizes, year built, etc) is the same and can’t account for the difference.

Yes, Zillow’s got a bit of a problem. To be fair to them, what they want to do (produce an accurate estimate on each and every house) is very hard work. Close to impossible. In contrast, the Case-Shiller algorithm is a piece of cake. They average over an entire metropolitan area, kinda hard to get that wrong.

[temeculaguy]

Zillow is still too high in most situations, because it looks backwards. Even six month old data is out or date, the only real data is seven days old and that is why appraisers will never be put out of work.

I jut looked up the zestimate for a house I’m scoping, it’s zestimate is 450k, down 25k in 30 days. Guess what, it is listed for 329k, not sold, still listed, but there were sales six months ago for comps that were in the 400’s, problem is, the computer cant keep up, there are places losing 25k a month, every month for the last year. Some mope logs on and sees his place next door went down 25k and wants to complain, have at it buddy, ask an appraiser and you will probably cry.

I checked the zillow for ten houses that I or people that e-mail me are looking at that are listed and every one was ziollowed as being down 20-50k in the last month but still 100-200k over the list price, I wouldn’t want to be working the zillow complaint department in six months when it really starts to hit the fan.

I still think that the weight on driver’s licenses should say “zestimate”

[temeculaguy]

Zillow is still too high in most situations, because it looks backwards. Even six month old data is out or date, the only real data is seven days old and that is why appraisers will never be put out of work.

I jut looked up the zestimate for a house I’m scoping, it’s zestimate is 450k, down 25k in 30 days. Guess what, it is listed for 329k, not sold, still listed, but there were sales six months ago for comps that were in the 400’s, problem is, the computer cant keep up, there are places losing 25k a month, every month for the last year. Some mope logs on and sees his place next door went down 25k and wants to complain, have at it buddy, ask an appraiser and you will probably cry.

I checked the zillow for ten houses that I or people that e-mail me are looking at that are listed and every one was ziollowed as being down 20-50k in the last month but still 100-200k over the list price, I wouldn’t want to be working the zillow complaint department in six months when it really starts to hit the fan.

I still think that the weight on driver’s licenses should say “zestimate”

[temeculaguy]

Zillow is still too high in most situations, because it looks backwards. Even six month old data is out or date, the only real data is seven days old and that is why appraisers will never be put out of work.

I jut looked up the zestimate for a house I’m scoping, it’s zestimate is 450k, down 25k in 30 days. Guess what, it is listed for 329k, not sold, still listed, but there were sales six months ago for comps that were in the 400’s, problem is, the computer cant keep up, there are places losing 25k a month, every month for the last year. Some mope logs on and sees his place next door went down 25k and wants to complain, have at it buddy, ask an appraiser and you will probably cry.

I checked the zillow for ten houses that I or people that e-mail me are looking at that are listed and every one was ziollowed as being down 20-50k in the last month but still 100-200k over the list price, I wouldn’t want to be working the zillow complaint department in six months when it really starts to hit the fan.

I still think that the weight on driver’s licenses should say “zestimate”

[temeculaguy]

Zillow is still too high in most situations, because it looks backwards. Even six month old data is out or date, the only real data is seven days old and that is why appraisers will never be put out of work.

I jut looked up the zestimate for a house I’m scoping, it’s zestimate is 450k, down 25k in 30 days. Guess what, it is listed for 329k, not sold, still listed, but there were sales six months ago for comps that were in the 400’s, problem is, the computer cant keep up, there are places losing 25k a month, every month for the last year. Some mope logs on and sees his place next door went down 25k and wants to complain, have at it buddy, ask an appraiser and you will probably cry.

I checked the zillow for ten houses that I or people that e-mail me are looking at that are listed and every one was ziollowed as being down 20-50k in the last month but still 100-200k over the list price, I wouldn’t want to be working the zillow complaint department in six months when it really starts to hit the fan.

I still think that the weight on driver’s licenses should say “zestimate”

[temeculaguy]

Zillow is still too high in most situations, because it looks backwards. Even six month old data is out or date, the only real data is seven days old and that is why appraisers will never be put out of work.

I jut looked up the zestimate for a house I’m scoping, it’s zestimate is 450k, down 25k in 30 days. Guess what, it is listed for 329k, not sold, still listed, but there were sales six months ago for comps that were in the 400’s, problem is, the computer cant keep up, there are places losing 25k a month, every month for the last year. Some mope logs on and sees his place next door went down 25k and wants to complain, have at it buddy, ask an appraiser and you will probably cry.

I checked the zillow for ten houses that I or people that e-mail me are looking at that are listed and every one was ziollowed as being down 20-50k in the last month but still 100-200k over the list price, I wouldn’t want to be working the zillow complaint department in six months when it really starts to hit the fan.

I still think that the weight on driver’s licenses should say “zestimate”

[beanmaestro]

Well, for shits and giggles, the duplex we’re currently renting has a Zestimate of 1.47M, despite having a total rent of $4100/mo, and being in worse shape than duplexes that have rotted on the market around $1.1M. When they’re off by 50%, you just have to laugh.

[beanmaestro]

Well, for shits and giggles, the duplex we’re currently renting has a Zestimate of 1.47M, despite having a total rent of $4100/mo, and being in worse shape than duplexes that have rotted on the market around $1.1M. When they’re off by 50%, you just have to laugh.

[beanmaestro]

Well, for shits and giggles, the duplex we’re currently renting has a Zestimate of 1.47M, despite having a total rent of $4100/mo, and being in worse shape than duplexes that have rotted on the market around $1.1M. When they’re off by 50%, you just have to laugh.

[beanmaestro]

Well, for shits and giggles, the duplex we’re currently renting has a Zestimate of 1.47M, despite having a total rent of $4100/mo, and being in worse shape than duplexes that have rotted on the market around $1.1M. When they’re off by 50%, you just have to laugh.

[Author]

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