As real estate sites have become more popular, so have online home value estimators. Many buyers searching for a home use an online search on their own before beginning with a real estate agent. While agents have access to more listings and sooner than the general public, there is an appeal to using an online real estate site for your preliminary search.
It’s no wonder then, that home sellers are starting to do the same. But you may wonder, are online home value estimators actually accurate? Here are some important things to consider.
Remember, It’s an Estimate
There are many value estimator websites out there. First and foremost, remember that any online site is simply an estimate, not a true value. It can be helpful to utilize a variety of respected sites to get a better average and don’t let yourself get too excited or disappointed by a surprising valuation.
Real Estate Agents Have Additional Information
With access to the MLS, real estate agents have more information than the average person. They have a better and more accurate valuation of your home than a home estimate website would provide. Real estate agents also have the benefit of experience on their side. This means that they understand what local market trends may be out there as well as how other homes in the area are being valued when it becomes time for an appraisal.
The Local Market Can Significantly Affect Value
Buyers looking for a home are concerned about more than just the brick-and-mortar building. A home’s location, school zone, and proximity to local hotspots can all greatly affect the appeal of a purchase. Likewise, some features that should add value may not be as coveted in your area. This can create a bigger gap between an online estimate and the true sell value of your home.
Certain situations can result in a vastly inaccurate estimation
- Living in an older area: Online estimators will compare your home’s square footage, number of bedrooms, and other features with public records. In older areas, these records are less likely to be accurate. If homes sell infrequently in your area there is also less data for the estimator to work with.
- Closeby neighbors are not similar: If your neighborhood borders both high and low-value neighborhoods, or has different school districts, an online estimator may not spot which comps are not viable comparisons.
- Your home is unique: Since your home doesn’t have a perfect comparison in your area, it will be hard for the system to accurately predict the home’s value.
