Recently updated on February 11th, 2023 at 02:18 pm
What You Will Read In This Article
- How Do Online Home Value Estimators Work?
- 11 Best Home Value Estimators Available
- Zillow
- Redfin
- Trulia
- Realtor.com
- Re/Max
- Eppraisal
- Chase
- Homelight
- ZipRealty
- NerdWallet
- Rentometer
Are you about to sell your house and need to figure out how to place a monetary value on your home that your heart says is priceless? Or are you planning to buy a house or refinance and want to check that the price is accurate? If you are starting out on this journey, your first stop will be online home value estimators.
How Do Online Home Value Estimators Work?
Online property valuation tools use the comparative market analysis approach to calculate the possible value of your home. The digital tools collate data from multiple listing services to compare recent sales and listing prices in the area. However, there could be limits to the data-sharing agreement.
The algorithm also pulls information from public records such as tax assessments, property transfers, and ownership deeds. This data helps to predict your property’s value. The automated valuation model won’t account for renovations done since the last refinancing or purchase data. It is also usually offered by a lender or real estate agency, which carries its own biases.
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You need to have as much information as you need when making this big decision. Rather you are on the selling or on the buying side, having the home value in your mind will help you negotiate the price or set the right price to attract buyers. While many factors influence why a home is sold, the price is the biggest one.
If you set the price too low, you will leave money on the table. If you set the price too high, the property may be on the market for longer than you can afford or not sold at all.
There are many home valuation tools online that you can use to give you an idea of where to start.
Here are the 11 best home value estimators available, including their drawbacks and tips to avoid getting a bad estimate.
1. Zillow
Zillow is the best overall home value estimator available. It is user-friendly and requires no log-in details. Its home value estimator is called the Zestimate, which provides an approximate value for your home based on public and user-submitted data. It uses data from multiple listing services, county and tax assessor records, and real estate brokerages to provide an estimated value.
The site also publishes by city the margin of error for its proprietary estimate. The nationwide average error rate is 1.9% for homes on-the-market. For off-market homes, the median error rate significantly increases to 7.5%.
Zillow shares the potential rent price and similar properties nearby. The Zestimate range is important. The wider the range means there is less data available to accurately calculate the value. Zillow helpfully indicates the home value change in the past 30 days and how it potentially could change in the next year. It will also publish recent tax assessment information, local schools, and provide a walkability score for the property.
Zillow has high-name recognition and is overall a smart tool. The Zestimate might be on the higher-end compared to other home value estimators, but the range it provides usually encapsulates the different estimations you’ll likely get on other sites.
Zillow has 110 million properties in its database, including FSBO’s. Overall, the Zestimate is a leader for the best home value estimator.
2. Redfin
Redfin’s estimate also draws on multiple listing services to generate a property value with a 1.73% median error rate for homes on-the-market. Its off-market estimates have an average error rate of 5.84%. Redfin’s platform is easy-to-use, and it will also show the home value will potentially change over the next five years. In addition, it will show similar properties nearby.
Redfin’s estimated price seems to fall within the lower spectrum of the Zestimate’s range. It also shares local schools, rent estimates, and provides a score on the neighborhood’s walkability and bike-ability. Like Zillow, it also provides crucial information about the community from the median list price to the average number of offers each property received.
Redfin is as well known as Zillow and provides similar types of information. There are clearly some differences in the data they aggregate, which leads to the variance in estimates. One of the primary reasons for the difference in estimations from Zillow and Redfin, both leaders of online home valuation tools, is that Redfin takes into account the listing price of a property.
This intuitively makes sense as the home’s selling price will likely be close to the listing price. When comparing a few properties prices, Redfin’s listing is usually lower than the Zestimate. This listing highlights the importance of the data used to generate the estimation. Redfin has almost 75 million properties in its database. But since it uses the listing price, many people think Redfin provides a more accurate assessment than Zillow.
3. Trulia
Trulia is also a great platform. The website is easy to navigate with a simple design. It shares similar properties nearby, local schools, crime rates, and the property’s recent tax assessment. Trulia also shares the median selling price for homes within the same zip code.
The Zillow Group bought Trulia in February 2015, so the Trulia estimates tend to be the same as Zestimate. However, the user experience is a little different. Some people may prefer one over the other based on their preference for how the information is displayed. The primary difference is that Trulia shows a crime rate map while Zillow does not.
At the bottom of the Trulia website, it also links to the Movement Advancement Project, an independent nonprofit that shows a map of LGBT protections across the U.S. Trulia also has an affordability calculator to help the user decide if a property is a good fit for them. The calculator includes homeowner’s association fees, insurance, and property taxes. This is a better feature than most mortgage estimators that other websites display.
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4. Realtor.com
Realtor.com is the official website of the National Association of Realtors. It won second place in Newsweek’s top three real estate databases for 2020. Realtor.com has a similar user experience to Redfin. In addition to the property overview of the number of bedrooms and bathrooms, it shares how the home value has changed over the past eight years and how it potentially will change in the next year.
Being able to see the trends in the price is really helpful to indicate if the neighborhood is improving. After all, if you buy a house, you will likely hold onto the property for many years before selling again. The website also lists similar properties in the area. They also have a visual timeline of the property’s history to indicate when the home was sold and at what price.
It will also show tax assessments and local schools. Also, the neighborhood’s average listing price, selling price, and how many days properties remained on the market are displayed above the listing prices for neighborhoods adjacent to the property you are viewing. This feature is great if you are unsure of what area you want to buy in.
Realtor.com also includes a similar feature that shows properties at the price you enter. This feature is really helpful if you have a set budget and only want to look at your price range properties.
5. RE/MAX
RE/MAX will provide an estimated value for the property, as well as public information such as tax assessments. The estimated price it offers appears on the lower end compared to other websites. It will also give an indication of how walkable versus driveable is the area.
In addition to the property’s history, RE/MAX shows demographics for the community’s population. For example, it will indicate age range, households with children, and owners versus renters living in the area. This is a great feature in case you want to buy a home in a neighborhood with children so your kids can make friends nearby.
Like the other platforms, you do not need to enter any personal information to get the free online estimate. RE/MAX also helpfully shows its estimate for the property compared to Zillow, Eppraisal and SmartZip.
6. Eppraisal
Eppraisal uses data from recent sales of 20 similar properties to generate its estimate. If it doesn’t have enough data, it will provide a Zestimate instead. In addition to the price, it will show demographic data on the community, such as education, finance, and employment statistics. It will also display similar homes in the region.
If you are using an automated home value estimator, you are likely visiting multiple websites. Eppraisal reduces some of this work by providing home values from other websites for you to compare.
Since Eppraisal averages the data of 20 properties to calculate its price, it is not likely a good option if you are selling an unusual property or using a nontraditional method such as sale by owner.
Learn how to sell a house and save thousands with ISoldMyHouse.com.
7. Chase
Chase is more widely known as a bank, but it also provides an automated property valuation for free. You do not need a Chase account to use its home value estimator. The website also displays the property on a map with the estimated price for your neighbors’ homes shown. This feature is fun to use if you are a nosy neighbor.
The tool also shows recent properties nearby that have sold and at what price. However, it does not offer as much additional information as other platforms. As the user should expect, the Chase website funnels visitors to consider using them for mortgages.
8. Homelight
Unlike most home automated valuation tools, Homelight requires the user to answer some personal questions and share contact details in order to receive an estimate. While this might be annoying to some users, additional information such as if you’ve recently undergone home renovations help Homelight provide a more accurate price range.
Homelight calculates data from five online estimators to generate its own predictive value. To be more transparent, the tool does indicate the level of confidence Homelight has on the accuracy of its estimation.
The platform will email you the estimation with two options for you to consider if you want to sell the property. The first option is known as the “HomeLight Simple Sale.” This option does not use a real estate agent, while the second option helps users find an agent.
Option A allows the seller to use an all-cash offer that doesn’t require listing with an agent. Option B directs users to an Instant Buyer, which is a real estate transaction model where companies buy homes from sellers to later re-sell. Opendoor, Offerpad, We Buy Houses, or Roofstock are examples of Instant Buyers.
9. ZipRealty
Some information on ZipRealty is only available if you create and sign-in to your account. After all, ZipRealty wants to capture your data to get you to use their agents. But the user can view the estimated cost without sharing personal information. Like other automated value estimators, it uses multiple listing services and public information to generate its estimated price. It will also compare its results to other online value estimators.
Like other platforms, ZipRealty promotes its agents who work with Realogy, its parent brokerage firm. This can limit the agents the website may recommend for you.
A differentiator for the website is its “Listing Check” tool. You can use it to find out if the property is still on the market. According to ZipRealty, about 15% of listed homes on other websites are out-of-date and not on-the-market. Therefore, wasting your time. While using data for off-market properties can be helpful for an algorithm, it would be frustrating to fall in love with a home online that is not available.
Learn how to sell a house and save thousands with ISoldMyHouse.com.
10. NerdWallet
NerdWallet uses the Zestimate figure from Zillow. So why even visit NerdWallet’s home value estimator? It has a frequently asked questions section to help people who are just starting on their journey to buy, sell, or refinance a home. The website also recommends additional articles the user can read that will help provide different perspectives and new information.
11. Rentometer (For Rental Amounts)
Do you have a property and want to rent it out but don’t know how to price it? Rentometer is the best website to help you find the “Goldilocks Price.” This rent price will help maximize your profits while still being attractive to secure renters.
Rentometer offers a free and premium package to help you decide what price you should set for your property in your area. It can also be used to help renters understand the variance in rent prices in surrounding neighborhoods should they decide to move or renegotiate their rate.
Users like Rentometer’s simple interface with a gauge that easily identifies if your rental rate is competitive for the market. The basic level of access shares the average rent price in your area and the percentage of rent prices that fall within different price ranges. Users have to manually enter the rental property details, such as the number of bedrooms, bathrooms, and square footage.
The premium package gives you access to compare rental rates and property details, such as the building type, address, square footage, and the number of bedrooms and bathrooms. Listings can also date back as far as 60 days or more.
Many online home valuation tools, such as Zillow, will also include a potential rent rate for the home as well.
What Can Lead To A Bad Estimate From An Online Home Value Estimator?
Home value estimators are just that–estimations. The tool’s flaw lies in the fact that it is just a tool. After all, the value of the home is in the buyer or renter. People weigh their decisions based on many invisible factors or personal preferences that the tool cannot take into consideration.
Additionally, the estimation is only as good as the data that is inputted. Different property data is collected in different parts of the U.S., and if there has not been a lot of recently sold properties, then the multiple listing services data will not be an accurate comparison. This data discrepancy can cause home value estimator tools to give inaccurate prices.
Data also does not factor in recent home renovations and other elements in the community that makes it an attractive place to live. Did a new Whole Foods grocery store open nearby? Is there a great dog park where you can take your new puppy too? Do you have friends or family already living in the area? Is your favorite yoga studio nearby? What is the proximity of the home to your office?
Online home value estimators empower buyers and sellers to have more knowledge and information, which can ultimately be leveraged in any real estate conversation or negotiation. However, the tool does not replace the value of a good real estate agent or first-hand knowledge of a property and a community.
We Negotiated Lower Realtor Fees For You
ISoldMyHouse.com has negotiated significantlylower commissions with some of the best real estate brokers so you don’t have to. We will match you with a top local agent in your area that will sell your house (without sacrificing service) for a much lower fee!
Find An Agent Near You!
All home value estimators include a similar disclaimer that the estimations should be used as a starting point. While Zillow provides the best overall home value estimation and Redfin provides the best for overall accuracy on pricing, they are ultimately just automated models. After you’ve entered your information into these websites, consider what could be missing from the algorithm that may change the home value.
Here are just a few factors to consider when you get your estimated home value from an automated tool:
1. Your Home Has Unique Characteristics
If the home has unique elements that are not available at other properties nearby, it makes it harder to compare and calculate an accurate price. For example, if your house is recognized as a historical building when other properties in the area are new builds, then it’s like comparing apples to oranges when you use an online home evaluation such as Eppraisal that depends on only 20 properties to generate its estimation.
A unique feature is also a personal opinion. If you added a wine cooler into your kitchen, but the potential buyer had this in his or her previous place, then it may not seem like anything special to them. No algorithm can replace human intuition when it comes to identifying and pricing the unique characteristics of a home.
2. Your Home Borders Changing Neighborhoods
Is the home in a neighborhood that is quickly gentrifying? Or are the neighborhoods surrounding the home rapidly growing? This type of change is often missed in calculating the home price. You can only discover this knowledge by talking with people living in the area to understand how they feel about the community.
What are the changes the neighborhood has experienced or is currently experiencing? How might this change in the next five to 10 years? For example, is the local municipality rezoning land? Could a new park be built or the area becomes more mixed-used? Has there been a recent spike in crime? This could all drastically change how a home is valued.
3. Your Home Has Been Renovated Without Permits
Did you know that you needed a permit to make home renovations? Small upgrades do not require a permit, but substantial changes like HVAC system overhauls and major structural work could. If you skipped the permitting step, you would run into issues when you try to sell your property without permits.
During this process, you may need a local government official to inspect your house to give you a certificate of occupancy. This confirms the resident is suitable to live in. However, in this process, the officer may notice you’ve made significant home renovations without securing permits, which could result in fines. If you increase the listing price to compensate for these fines, this will make your house less desirable to a buyer.
4. The Market Has Changed Recently
The economy’s health may also impact the listing price. If the country is in a recession with high unemployment, the value of homes may decrease. At the same time, if you are selling your property when the market is growing, your listing price may be inflated.
As your economic teacher said, it is all about supply and demand. If there are more houses on the market and not a lot of demand, the price will be driven down. If there are fewer houses available but a lot of demand, then the price will go up.
5. Homes Don’t Sell Very Often In Your Area
If there are not a lot of homes in the area that have recently sold, then there is not a lot of data for online home value estimators to compare. This will reduce the accuracy of the estimations provided. When estimation tools provide a wide potential price range, this is also an indicator that there was not a lot of data. There may also be external factors why properties have not been sold recently, which you should investigate.
6. You Live In An Older Area
If the neighborhood is undergoing revitalization, you may need to put more effort into increasing the home’s curb appeal to potential buyers. Stage your home and schedule open houses during a time of the day and day of the week that is quiet and will show the neighborhood in the best light. You could even provide driving directions for people that will take them by the most scenic route to the house. The goal is not to deceive but to ensure potential buyers don’t prejudge the neighborhood before falling in love with the home.
Learn how to sell a house and save thousands with ISoldMyHouse.com.
Final Thoughts on the Best Home Value Estimators
After you’ve used several online home value estimators, getting a professional appraisal is important. While Zillow and Redfin provide very good estimations, you will want to go one step further. The listing price is the biggest factor as to why a property will sell quickly or not. Getting the price right is worth the investment in time and resources.
Many of the home value estimators will direct you to real estate agents that can help you move forward in your journey. However, don’t forget, real estate agents will also have biases. If you decide to get a professional appraisal, make sure the agent is truly familiar with the area you are interested in.
If they have not worked and lived in the area for long, how would they know how the community has changed over the past few years and its trajectory in the next decade? After all, buying a home is a long term investment. Please check your agent’s background and share information with them, so they understand what you are looking for and need in your new home. Your real estate agent should become like your best friend.
However, just like online home valuation tools, real estate agents will not always be able to provide all the information you may need to make this big decision. Good algorithms used by companies such as Zillow and Redfin are powerful and able to analyze a lot of data. Therefore, it is recommended you use both methods to ensure you have the most accurate information possible before you put in an offer or list a home.
