Zillow Z-Estimate Case Study (Zach and Isabel’s House)

Zillow has been wonderful for our business. It’s a great platform for both real estate searchers, investors, and agents. It allows buyers and sellers to identify trusted agents to work with, and allows agents to market themselves with listings, sales and reviews to those online viewers. Zillow’s Z-Estimate has become a prolific part of the real estate industry that is accurate and some markets, and not so accurate in others – particularly those markets with lower inventory, fewer sales, and a wide variety of homes and architectural styles. Buyers and sellers contact us with questions about their home or prospective home, and how their Z-Estimate relates to the market value. We wanted to share our experience with the Z-Estimate in just the few short months we’ve owned our home in hopes that our viewers will take the Z-Estimate with a grain of salt. It can be accurate in some cases locally, but at the end of the day, the Z-Estimate is an algorithm that doesn’t know all the details. It might not know that you have an ocean view from your guest bathroom, or the extent of your recent remodel that brought you a pile of equity.


We purchased our house for $439,000 in June in Upper Seaside, and the appraisal came in about $19,000 over our purchase price. We were thrilled because we had worked with this appraiser in the past, and he is very conservative. To be frank, we were worried it wouldn’t even appraise at our purchase price and we would have to come out of pocket to make up the difference. So for us, this appraisal was a big deal. It’s a fixer upper, and we’re doing most of the work ourselves.



We have since painted the house inside and out, and now we’re starting to landscape. We’ve been following Zillow’s Z-Estimate, and we found that the house went up in value $2,000 after we added in the paint upgrade. So, our Z-Estimate is just shy of $441,000. Zillow doesn’t know that our appraisal came in at $456,000 since it’s data is pulled from the sale price of the home.


Update: With a few recent renovations, we were able to make a few additions to our Zillow home facts. We added a garbage disposal, and realized we hadn’t included the sprinkler system that probably needs a tune up, but we checked the box. We also realized we hadn’t checked the box for having a garden. Zillow doesn’t know how luscious our garden is, but the house came with some nice roses, birds of paradise, and we’ve added about 10 potted plants that make the front yard look really nice. The surface is covered in pea gravel and bark that could use a touch up, but we love having coffee in the mornings here. When we saved our additions on Zillow, our Zestimate shot up $20,000.

My jaw dropped, and dollar signs started racing across my eyes. I can now say I truly understand the Z-Estimate appeal, but we have to consider the source. They don’t know that only the front yard is landscaped, and there were not multiple boxes for front and back yard for us to specify which area looks nice and which area looks like a barren wasteland.

We hope this case study shed some light on the Z-Estimate. When you’re thinking of buying, selling, or renovating a property, and you’re looking at values, consider discussing values with a broker because there is more to your property than meets the algorithm!