Determining A Home’s Value – Part 3 – Why Zillow Sucks

Waaah! Waah! Can’t I just cut out all this hard work and use Zillow?

As you saw in the example in Part 2 in this series (Determining a Home’s Value), finding good comparable homes can take a bit of time, and performing the calculations can often require some level of estimation if you aren’t familiar with the area or the features of your home.

Why go to all this trouble when there are websites that will tell you how much a home is worth?

To put it bluntly, the websites can suck. There are three main websites that Mr. PoP and I look at for real estate valuing information: Zillow, Trulia, and ePropertyWatch. While they obviously don’t disclose how they calculate home values, there seem to be some weaknesses in their algorithms. So let’s see how they compare to each other on our house.


Zillow is a company that provides information on recent real estate sales, as well as current real estate listings from the MLS (Multiple Listing Service) that most realtors use to list their available properties. They take information from all of these sources and come up with a Zestimate of how much a home is worth. Zillow has a partnership with Mint (which we love), and so you can have your home value included in your Mint account by linking in the Zestimate from Zillow. The value in Mint gets updated whenever Zillow makes a change.

We’ve owned our house about 3 years, and in that time period, the Zestimate has been all over the place, ranging from $125K to $190K, and sometimes the adjustments in the value are quite dramatic. I remember about a year ago the Zestimate had our house at around $170K, and dropped to $145K a week later.

Currently, Zillow has our house valued at $155K (it was $150K a couple of weeks ago). It also shows Comp #2 (from the example in Part 2 of this series) as having a current value of $155K. My best guess is that the algorithm relies largely on $/sqft calculations and take into account things like pools or views that they would find in the public records.


Trulia is a lot like Zillow, but it always tended to have a lot more demographic information about neighborhoods and school districts. The addition of Trulia’s home value estimate functionality is relatively new. From what I have seen so far, the values are jumping around quite a bit, so who knows if they will settle down as Trulia tweaks their algorithm. Two weeks ago, Trulia showed our home valued at $158K, and today it shows $169K. Unlike Zillow, Trulia seems to be using more than just the $/sqft as they have Comp #2 currently showing a value of $146K.

For today at least, Trulia’s value looks pretty accurate for our house, but I would argue that Comp #2 is undervalued by their algorithm since it recently sold for about $15K more than their estimate.


ePropertyWatch is a bit different from Trulia or Zillow. Rather than letting you look at home values for any address, ePropertyWatch requires you to register your home and confirm it’s yours (it’s free!). We primarily use ePropertyWatch as a notification service. ePropertyWatch combs through online public records, constantly adding information to its database. When sales and foreclosure filings happen around the neighborhood, ePropertyWatch sends an email to let you know. (That’s how I know all of the recent sales around us.)

It’s probably because they rely so much on public record that the home value listed on their site is actually shown as the change from what you purchased the home for, and seems to be calculated that way as well. Ours currently shows that the value is down $1K from our purchase price.

Because they calculate home values based your purchase price and market changes since your purchase, that doesn’t really help if you purchased a “fixer-upper” or some other property that may have not been valued at the market value when you bought it (maybe you bought your home from a relative’s estate at a discount to market value). Our home needed major work when we bought it for $139K, work that we have since completed, but ePropertyWatch has no way of knowing that to include it in their algorithm.

As you can see, none of the websites are perfect. And since your house is such a big part of your net worth, doesn’t it make sense to do the work yourself and know the comps? How do the websites stack up against comps that you’ve run for your own home? Or if you’ve recently had your home professionally appraised how did that value stack up against the sites?

Read the rest of our posts on determining your home’s value:

13 comments to Determining A Home’s Value – Part 3 – Why Zillow Sucks

  • Most of the homes on our street were built in the 50’s and thankfully when we bought, we also had a bunch of new neighbors move in too and all the homes were fixer uppers. Now as they are starting to move out, property values have rose significantly because they aren’t fixers anymore. I think you’re right. This is the hardest part of estimating a neighborhood’s value. There is no way to tell if a neighbor’s place that sold was a dump that hadn’t been touched since it’s been built or if it had been totally remodeled recently.

    I guess you can kind of tell a little by the age of the neighborhood. I’ve been looking at some developments built in the 80s. The majority of those homes haven’t been remodeled. They are still too new to do anything about it, but old enough that the places look dated and tired.

    • Yeah, age of a neighborhood/house can tell you some, but not everything. That a big reason that when we’re estimating how much our house is worth, we assume all the homes that were sold were *perfect* on the inside, so if anything we’re underestimating on our house. But, you never know, and that’s probably the biggest weakness for all of these algorithms. I hesitate to think how crazy the Zillow values are in a neighborhood that’s undergoing gentrification in big city like some areas of Philly or NYC.

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  • Robert

    How does zillow take a 500k condo and say its worth 180k on Zestimate.
    Why does zillow compare a 50ok condo to all 200k condos. Always inaccurate .
    Zillow sucks!!

    Not professional

  • Alan

    1121 and 1201 W Ironwood Drive in Phoenix are two identical adjacent vacant lots. Zillow thinks one of them is worth $11K and the other one’s worth $279K. There are no significant digits in a Zillow estimate.

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  • Zillow is a piece of crap, a worthless inaccurate site

  • sal

    I put my home for sale and had a professional give me an appraisal of my home,. Which was $600,000. Home is 2650 SQ. FT. and every room is updated. Happened to go on Zillow and they appraised it for $363,000. What a difference. My neighbors home which is half the square footage then mine with no up dates, needs about $100,000 in work is appraised on Zillow for $464,000. How does Zillow come up with these numbers without looking at the home or going inside them. Something needs to be done, I hear too many complaints about them. about them.