Did you know that Zillow measures and publishes their Zestimate accuracy rates for every county in the US? Zillow is famously inaccurate in many areas – but what about the Zestimate of your home in Middle TN? Can Zillow be trusted to give you a good idea of the sales price of your home? Let’s look at their data for 4 counties in Middle Tennessee: Nashville-Davidson, Rutherford, Williamson, and Wilson counties and put the Zillow results to the test.
A quick recap
In a previous post, we considered how “hard” and “soft” data contribute to the true market value of a home. We also looked at the fact that online home value estimates only consider part of the hard data, and virtually none of the soft data. The basic reason why there is such a huge error rate with online automatic home valuation websites such as Zillow is that they cannot possibly include all of the information that is required to accurately estimate what a home will sell for. The details are fascinating – I encourage you to go back and read “Why Is the Zillow Zestimate Wrong?” if you haven’t already.
The question I always get at this point
“But what about the Zestimate for my home?” Complete the home market value request form and I will gladly provide you a free professional estimate of your home’s value. Our office does an excellent job of providing a highly accurate estimate of what your home will sell for. Contact me today to find out what your home is really worth.
OK – the nitty gritty: Just how bad is the Zestimate in TN?
Let’s look at 4 middle TN counties:
- Davidson county includes Nashville, Nashville-Davidson, Bellevue, Belle Meade, Forest Hills, Oak Hill, Berry Hill, Lakewood, Antioch, and other areas.
- Rutherford county includes Smyrna, Murfreesboro, Christiana, Arrington, and other areas.
- Williamson county includes Franklin, Brentwood, Nolensville, Fairview, Thompson’s Station, and other areas.
- Wilson county includes Lebanon, Mt. Juliet, Watertown, and other areas.
It’s not you, it’s me… Well, ok, it’s you, but no hard feelings
Please understand that I don’t intend to pick on Zillow. At least they have published their accuracy rates. The other online automatic home value websites use similar methods, and if they were any more accurate, they’d probably have let us know by now.
As a reminder, Zillow only has data for 41 of Tennessee’s 95 counties, but they may still give you a “Zestimate” whether they have data or not. Even in counties where they have data to include in their estimate, they can be missing basic information, such as the number of bedrooms, bathrooms, or square footage. They explain all of this information in the Zillow “Zestimate” disclaimers.
Following are recent (accessed as of 2017) Zillow reports from these Middle Tennessee counties. Compare these to our office’s accuracy rate: we were on average within 1% of the sale price.
Zillow’s numbers – it’s not great
Let’s start with the area’s largest market, Davidson county (Nashville, Nashville-Davidson, Bellevue, Belle Meade, Forest Hills, Oak Hill, Berry Hill, Lakewood, Antioch, etc.)
|Zestimate accuracy threshold:*||5%||10%||20%|
|Sold within threshold:**||46.2%||67.4%||83.4%|
|Sold outside threshold (inaccuracy rate):**||53.8%||32.6%||16.6%|
- * The Zestimate was within 5%, 10%, or 20% of the actual sold price
- ** The percentage of homes that sold within the accuracy threshold
- *** The percentage of homes that sold outside of the accuracy threshold
What it means:
In Nashville-Davidson county, only 46.2% of homes sold for within 5% of the Zestimate, only 67.4% sold for within 10% of the Zestimate, and only 83.4% were within 20% of the Zestimate.
In practical terms:
The Zestimate in Nashville was off by over 10% for nearly 1 in 3 Zestimates (specifically, 32.6% of the time). For a home with a Zestimate of $250,000, that’s an error of $25,000 (10%). 1 in 3 really sold for more than $275,000, or less than $225,000. And that’s why we can’t use the Zestimate as anything more than a rough ballpark figure, at best.
In Nashville-Davidson county, exactly one in every six Zestimates (16.6%) was off by more than 20%. That’s at least a $50,000 error for a $200,000 home! How much more were they off? Zillow doesn’t provide that level of detail. Only a local expert, a real estate professional with the most up to date market information, can provide a true estimate of value.
Clearly, in Davidson county, basing an estimate of value on the Zillow “Zestimate” can provide a very broad, ballpark figure at best. It’s no better in Rutherford county:
In Rutherford county (Smyrna, Murfreesboro, Christiana, Arrington, etc.) the accuracy rates were similar:
|Outside threshold (inaccuracy rate):||41.7%||16.7%||7.3%|
So, 58.3% of the time in Rutherford county, the Zestimate was within 5% of the sales price. 83.3% were within 10%, and 92.7 were within 20%. 2 in 5 times (specifically 41.7%) the actual value was within the Zestimate by 5%, 3 in 5 times it wasn’t. Nearly one in thirteen Zestimates in Rutherford county is off by 20%.
In Williamson county (Franklin, Brentwood, Nolensville, Fairview, Thompson’s Station, etc.) the accuracy rates are:
|Outside threshold (inaccuracy rate):||42.5%||16.7%||6.8%|
In Wilson county (Lebanon, Mt. Juliet, Watertown, etc.) the accuracy rates are similar:
|Outside threshold (inaccuracy rate):||47.9%||28.1%||12.0%|
So, about one in nine Wilson county Zestimates is off by 20% or more.
The Bottom Line
Online estimates are really, really inaccurate. Zillow is inaccurate. Trulia is inaccurate. Every computer generated “estimate” is inaccurate. But, is the online “Zestimate worthless? Read my next post to find out what you should do with automatic online home value estimates: What Should I do with my Zillow Zestimate?
There is data available for other counties, but you get the picture. Our office can measure our accuracy to within less than a percentage point. The accuracy of the online valuations isn’t even comparable.
Have you read the other posts in this series?
Contact me today to find out what your home is really worth.
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- Smyrna TN real estate market snapshot
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Aaron Lovett is a full-service Realtor in Smyrna, TN, working with Weichert Realtors, The Andrews Group in Murfreesboro, TN. His service area includes Smyrna, Murfreesboro, the remainder Rutherford county and surrounding areas. Aaron has lived in the area for over a decade. He takes pride in helping home buyers and sellers reach their real estate goals.
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