Personal Finance

In Part 1 and Part 2 of this entry, I discussed how Zillow.com can be infinitely useful in helping you determine an accurate market value for your home when you're thinking about selling. On the other side as a home buyer, Zillow.com also offers unique benefits that I found to be extremely useful in my search for my next home to purchase. Of course, when buying a new home, you can use all of Zillow.com's estimating features to determine a reasonable market price for the home you want to purchase. But, as a buyer, you can really make use of the satellite map feature!



In my case, as I've mentioned before, I need a property that can accommodate horse facilities. By looking at properties via satellite imagery, I can instantly assess how the home has been situated relative to the overall property dimensions. For example, a 1 acre lot can very adequately accommodate extensive horse facilities if the home has been built near the street, with contiguous open space reserved at the back of the lot. In other cases, a 2-1/2 acre property might be unsuitable for horses if the home has been sited at the very center of the lot, leaving smaller margins around all four sides. Now, while horses might not be your particular concern, you may instead be very particular about privacy, proximity to other homes, traffic from main thoroughfares or density of the surrounding community. You'll see so much information by looking down on the neighborhood from up above! Give it a try, and you'll soon love the satellite mapping capability of Zillow.com as much as I do!

OK, over the past three days, I've shared my love of Zillow.com with all of you, and I hope you've seen the power provided by this free, unrestricted and professional website. To be fair, I'd also like to share the possible things to watch out for when using the data offered up by Zillow.com. First of all, the website creators themselves acknowledge that the Zestimator's output is only as good as the automated online information recorded and published by the local property tax assessor's office. In my case, they report that the Phoenix, Arizona market has a very robust and advanced tax assessor online capability. So Zillow.com may be more useful to me and to people in other metropolitan areas than it is in rural areas or smaller communities. This should improve over time as more and more public property tax data becomes automated.

Second, as also reported directly by Zillow.com, their Zestimate may be generically skewed within an area (up to 20% high or low) based on the estimating models used by the county tax assessor. Since Zillow.com also calculates actual home sales into its model, this price skewing should also decrease over time as more and more actual home sales date is calculated into the model.

Finally, as I noted when describing the Zestimate for my own home, the tax assessor treats property improvements and additions of square footage in a different manner than the originally built square footage of the home. Whenever you use Zillow.com to estimate the price of a home you're considering buying or selling, you should always verify the square footage used in calculating the Zestimate -- incorrect square footage puts you completely in the wrong ballpark when it comes to comparable home prices. I've looked at literally dozens of homes over the past few months on Zillow.com, and I've found numerous older homes that have more square footage reported in their MLS listing than that recognized by Zillow.com. These homes have obviously seen improvements and expansions over their previous lives.

Well, those are my thoughts on this very interesting real estate tool. If and when I finally put my home up for sale and purchase a less expensive property, I will be an extremely knowledgeable consumer! And now, you can be too.