Zillow, Trulia and then the Real World
So what is up with the difference in prices between Zillow, Trulia and the like, and the prices we see on the live market?
Well the truth is the aggregate websites, named as such because they aggregate data from multiple sources, are up to 8% off according to their own (Z) estimates.
Why is this so? Well because they do not have access to MLS. These sites do not provide brokerage services and as such do not have access to the MLS or Multiple Listing Service. If you are wondering, the MLS service is what brokerages like Shorewest and the rest use to share listing data between each other, foster cooperation and make it possible to handle transactions between each other with much less fuss than it would be otherwise.
The aggregate websites, although their algorithms are propriety, seem to collect data from publicly available sources like tax assessments and, I am sure, their own private databases. The issue with tax assessments, is that they are typically done from an office somewhere in the bowls of a government office building. That means they are rough estimates on what they property is worth based on inflation, building permit requests, fire reports, and so on.
What does this mean for you the buyer or seller of said properties?
Well it means that the numbers you see online are discretionary.
Trust your Realtor for numbers.
Realtors have access to the latest data from the MLS which they then take and crunch using different methods to come up with a reasonable number to list your home or commercial property at, or a number which you can offer on a property that is likely to be taken seriously while still being reasonable.
Hope this little article helps bridge the gap between the numbers you see out there!