Active and current esscrows also need to be considered (if you want an accurate opinion/estimate of value) .

Zillow also doesn’t seem to take into account location issues (busy street, or other negative influences).

How cool is that, you got someone from zillow defending themselves.

Hey zillow guy, there is an art and science to pricing a home and you only have the science part down, not the art. But a great service nevertheless.

Welcome onboard. Glad to see Zillow active on housing bear blogs! Zillow is an excellent tool especially in regards to finding quick information on a property, especially previous tax sales since this theoretically should be 100% accurate. This property is easily found on http://www.realtor.com or ZipRealty; just query a property between $220,000 and $250,000 in Pacoima – not much of these exist in California especially in this city. You’ll recognize it by the cars on the lawn.

I feel that Zillow will dominate in a market where prices are stable. I have used it for querying properties in Oklahoma and Texas and find the prices are about 2 to 3 percent off real appraisal values. Pretty damn good if you ask me.

However, you can see what occurs in really hot markets such as those on the coast. They perpetuated the high price myth because sales data take 2 to 3 months to show after escrow has closed; tax records take even longer from my experience. From what I gather, Zillow takes prices of homes in surrounding areas and Zestimates by previous sales data. So in a market that is rapidly shifting I’m not sure how Zillow can account for this. Maybe you can answer that for us since we’d be extremely curious?

Again, my hats off to Zillow and places like ZipRealty that are taking the power away from a monopoly such as the N.A.R. and C.A.R. and the way they stranglehold the MLS. This data is easily analyzed with a simple real estate evaluation tool from Excel however key points are so difficult to come by. How can you account for a home in Pacoima that was sold by fraud via a sub-prime mortgage obviously inflating the price and then using this as a reference point for future sales? Again, I think Zillow will do great once the market settles down in California but we will be going down for a few years especially with foreclosures rising.

I need an address if I’m going to comment on a Zestimate but I doubt that the reason we’re this far off is related to depreciation — as you point out, it’s more likely that we don’t have good data to work with.