Comments ( 10 )

• Hi Joe,
  Katie from Zillow here. Just wanted to give you a little more information on Rent Zestimates, their uses and their accuracy.

  Rent Zestimates are a starting point in determining the monthly rental price for a specific property. They are based on data about the home itself, as well as information about similar properties listed for rent.

  For the property you refer to, it’s important to note that the public record data did not specify anything at all about the home — not the number of bedrooms and bathrooms, nor the square footage. The last time the Rent Zestimate was updated was on Sept. 6, and that figure was based on the old (nearly non-existent) public record data. Without that data, the Rent Zestimate is less likely to be accurate. Since the home was listed for rent two days ago and the home facts were updated to show 5 bedrooms and 4.5 bathrooms, that information will be factored into the Rent Zestimate when it is recalculated this month.

  To talk more generally about the Rent Zestimate, it’s also important to know that Zillow tracks and publishes accuracy down to the county level. In Cook County, Rent Zestimates have a median error of 9.1%. You can see more here.

  I hope this information was helpful.

• I can rent my parking space for over $1,400/month! Unfortunately, I can only rent my condo out for $1,500/month, which is ~$500/month too low in my biased opinion. Apparently, the recession has really been a boon to the parking tycoons!

• Yes, for a professional, they are. Making price/ rent estimates from mysterious public data is useless for practical market purposes. We know that county or MLS data many time does not reflect actual home features or any number of detail.

  “Zestimates” in my opinion should be for entertainment purposes only…like football handicapper disclaimers.

• If you have a large enough sample size they will be accurate. This smooths out the “inaccuracies” in entering property attributes and property anomalies, etc… Does every single realtor enter in inaccurate data? Is every property located next to a dump? I doubt it.

  I find the Zillow estimates to be fairly accurate. And, I don’t work for Zillow either. I am a non-realtor real estate investor.

• A large sample only leads to greater accuracy for the whole of the sample. It doesn’t ensure greater accuracy at the property level.

• There is no “accurate” price estimates for sales or rentals based on public county and MLS data. “Estimates” for rent or sale price of an individual property using public county and MLS data are basically useless. The data set doesn’t matter. If comparables are the only thing that mattered, one condo neighbor wouldn’t sell (or wouldn’t have to sell) for tens of thousands less than his/her neighbor across the hall within 6 months of each other…which happens a lot.
  At the same time, if I looked at the estimates for three bedroom condo rentals in Uptown, I would have never listed and rented a clients home at 4610 N Ashland for $2,895 and got list rental price. We would have listed for less and lost the client a lot of money.

  A quick look at Zestimates for my immediate neighborhood show most home Zestimates $20K -$100K over the LISTED price.

  So, all I’m, saying is … rent and price estimates are not useful. It’s a marketing gimmick and should not be defended as a service. As quoted above “In Cook County, Rent Zestimates have a median error of 9.1%.” Okay, great, the median price and 10% margin of error get me nowhere for pricing anything.

  Here’s where my disdain lies. A broker site like Redfin at lease does a service in having a good amount of sales data handy and a popular interface. The Zillow’s have a marketing gimmick . That’s it.

• @Eric,

  You make some great points and provided a very thoughtful response. Forgive me for my ignorance, but short of contacting a Realtor, where should a home owner go to get a rough estimate on what their home is worth for sale or rent?

  I would love to learn of other online services that provide estimates.

• Zillow is completely worthless in neighborhoods like Lincoln park winnetka or hinsdale with new and old homes, and values that vary. there estimates are hundreds of thousands off; once a house sells for market price, values mysteriously “shoot” up, and then gradually retreat until the next sale. Worthless., I tell you……..

• Yes….Zillow estimates are ‘worthless’ more the most part. It is in their best interest to undervalue property that is actually for rent or sale. Reason being…once it’s rented or sold it is no longer a DRAW for their website. By undervaluing listed properties people look at the listings and think you are asking to much or your overpriced when in reality you are probably more accurate with your assessment than any supposed Zillow ‘propritary formula’. I have never seen such a crock. I have been building houses for almost 40 years in the same county and know the values as well as any realtor or bank…yet Zillow has this concocted valuation that makes no sense in the real world.
  I would give a couple of examples but they are in California and I believe this is a Chicago post so the pricing wouldn’t be relevant…but this interesting part is their valuations are not correct regardless of what state you are in. In fact try to talk to someone at Zillow and get their explanation. It’s about the same as calling Microsoft and expecting to talk to a customer service person….yes laughable and upsetting at the same time. Innocent home owners are being victimized by Zillow.

• the zestimate rental estimate for my condo is actually very accurate and fair