Mine went up but I didn't realize it was due to this change. I still think these Zestimates are bogus anyway. I live in a townhome community and the Zestimates vary widely despite us all pretty much having the same house and yard size. My next door neighbor's house is supposedly worth $20k more than mine. I think Zillow has a little more work to do on their math!

Consumers need to wake up to the errors of using Zillow. Im a Realtor, and recently a customer tells me every house ive shown them is severly overpriced, per Zillow. I showed her recent solds to refute this, and showed her how Zillow had severely underpriced some of the comps, only to adjust upwards AFTER the comp settled, many times 10% or more on 400k houses. Buyer thought I was full of BS, and walked. I wish sellers would allow me to be wrong more than 5% of the sales price 66% of the time. I will guarantee the house will sell for less than 5% of my price (and not a cut rate price, a market price)- or my commission is free. What will Zillow do- nothing.

Seems to me that perhaps Zillow hasn't caught up with the recent MD reassessment cycle. I live in the Timonium area; the Zestimate for my property was probably pretty close give the 2010 assessment. It is grossly over-inflated based on the 2011 assessment.

All this business about the algorithms, not sure yet how their "new" ones will pan out during ups and downs since things are mostly down lately. But I have watched these for a long time and have felt that their estimates for my two properties were consistently off, either overshot or lagged the market in both directions ... up and downswings... moreover, their comparitors one of my properties have always been wrong so pretty grossly undervalue the house, even for this market.

I was stunned to see my house valued at only $332k on Zillow the other day. On May 1st - 2.5 months ago, it was valued at 351k, and on May 1st last year, it was valued at 377k. What explains this? I'm at a loss.

The house next door sold last year (after the tax credit had expired, btw) for $384k, and it has a smaller lot and is currently valued by Zillow $334k. Another house a couple of streets over sold for 355k in late april, 2011 - less than 3 months ago - but the zestimate is $322k. Even with the benefit of a very recent sale, the zestimate is off by over 9%. How did it lose more than $20k value in 3 months?

Another house on my street sold for $335k in vary late may, 2011. It has a lot size about 1/3 of mine, 1/2 bath less, a smaller building size by 300+ sq. ft. and is closer to a busy street and a train line. Yet, Zillow has my house's value at $332k! To be fair, Zillow even that house undervalued at $326k. Still, if someone were to use that house as a comp to mine, I'd ask if they prefer an 8k lot to a 3.5k lot, an extra 1/2 bath, an extra 300+ sq. ft. to live in, no train/traffic noise and curb appeal.

Is it possible Zillow somehow incorporating zip code averages into the calculation? For example, the prices for my zip code have tracked the price of my house at a roughly $40k differential according the *current* Zillow history going back 10 years or so. That is, until this last change, where now the differential is about $6k - again, for no apparent reason.

Many more horror stories on the new algorithm can be seen here:

http://www.zillow.com/advice-thread/Zillow-Announces-Zestimate-Improvements/403036/

Zillow is a search program and doesn't get updated until the websites the information pulled from are updated. My house showed for sale for approx 6 months after I purchased the house. This changed once the Tax Records were updated by the city and my info showed on the Tax Assessment website. It's not an over night process, plus what hurts the assessments the most on Zillow is that not everyone has "claimed" their property & updated the information. My Parents no longer have an asbestos siding house & it is a 2 full bath not one full bath, as that is what the old records have listed. So the Zillow estimate is probably a little lower than it should be, not including all the other details that you can add & change on the "home owners" profile.
Zillow is great to get a good idea of properties in the areas, and search for houses for sale but NOT for accuracy. The biggest thing is to remember is that Zillow is a SEARCH Engine for houses.

@pigtown girl:

Certainly I agree with your assessment of the time lag of sales transactions having an impact on Zillow's estimates.. However, I got these recent sales prices directly from the Zillow site.

I haven't included all the improvements I've made to my house in my complaints. I'm not interested in selling my house at this point, so that's irrelevant.

But, what I do expect is, given the *generic* information that they've been using up till now, to be roughly accurate in their estimates. And in fact, for a long time they seemed pretty good and had a certain level of credibility.

But the new algorithm seems to have gotten things really out of whack. How can a house value which was always roughly 40k differential from the zip code median suddenly drop to mere 5k differential? in a period of few weeks? Despite several recent sales? And this 40k differential is taken from their "updated* history, not the old one that they've chucked. They are contradicting their own data!

I'm really upset about it, because it could actually have an impact on house prices. People pay attention to Zillow, rightfully or wrongly. I find their numbers to be very suspect, and they need to be accountable and transparent.

The old axiom, "you get what you pay for" applies to Zillow.

I feel for the realtor who posted above with buyers relying on this stuff. This service is far from accurate. It relies on wrong or outdated records from tax rolls. I think its only value (using this loosely) is to provide a "ballpark" for values in an area.

My 30 years of banking experience says don't put "any" faith in those Zillow numbers. Need a value estimate? Buy an appraisal or have a RE agent do a market analysis.

@ Jack

Those changing values variables remind me of appraisal issues. You can move to blocks one way & move two blocks the other way to pull your compariables and have an appraisal that varies by $55K w/in two months. (It happened to me). And all those properties listed on the appraisal were avaible for me to look at on Zillow.
I really don't see a real way to accuratually correct the information on zillow, expecially in the city, one mile can make an extreme difference in property value.

Everyone who's always asked me about zillow, I tell them to take that information w/ a grain of salt and do your own research.

I've noticed a lot of attorneys that have moved away from using the Zillow estimates and have gone back to paying for a property appraisal for their motions and other legal happenings.

This is the worst zestimate I've seen:

http://www.zillow.com/homedetails/2339-Boston-St-UNIT-3-Baltimore-MD-21224/62786446_zpid/#{scid=hdp-site-map-bubble-address}

A four story Canton waterfront that sold in 2003 for ~$900K is now worth $139K?!?!

Troy.... Canton? Haha! The gound the house is on is probably worth more than that!!

While we may all agree that Zillow estimates are bogus, the real problem is that banks, like Wells Fargo and the BofA, legitimize these estimates by importing them into their financial systems. Why do banks consider Zillow estimates to be valid? What are they doing with this data anyway?

I know that most of the people on this blog are not big fans of Realtors... But Zillow is a dart throw at best when it comes to the Zestimate. Any Realtor in the world would be more than happy - free of charge or obligation (at least, I never obligate) - to give you a list of recent sales and an opinion on selling price or market value. And they use actual recent sales data and comparisons, not some crazy algorithm based on who knows what.

Wells Fargo didn't go near the Zillow estimates when I had problems with my appraisals.
No where in any conversation did Wells Fargo mention Zillow, the realtor selling the property for HUD was the same way. Most FCL attny's don't use Zillow either so saying that the banks use the Zillow estimate is a blanket statement that isn't correct.

For those interested, I've found a much better site for estimates than Zillow called homesand.net. It seems almost uncannily accurate after trying to make sense of Zillow's estimates. My house is valued there at 380k rather than 332k as on Zillow. But it's not uniform - in some cases the homesand estimate is lower than zillow, some cases higher - but it mostly just makes sense. Anyway, it's the site you need to go to for reasonable estimates.

"Anyway, it's the site you need to go to for reasonable estimates."

Jack- 2 questions.

1. Is "reasonable" defined as some number that is lofty enough to make you feel better?

2. Why would you care about either website approximater? They are not real appraisals. The market dictates what your home is worth -nothing else.

I think that if i came up with a 3rd website that said your house was worth 500k you would proclaim, "now that is a website that knows what it is doing!"