You know those online property value estimates that tend to veer wildly from reality — the infamous and notoriously unreliable “Zestimates”?
RedFin has also entered the dubious property estimate game, using a different algorithm than Zillow to arrive at a valuation. Often the two results differ by hundreds of thousands of dollars. (Try out your property!) Both miss the mark most of the time. They both regularly fail to take into account the factor that is most critical in our market: Buyers.
Certainly outlier buyers are difficult to predict by any source, but buyer behavior is what determines the sales price, which is, in essence, the market value of a property. Market value is not necessarily an empirical calculation, in part because buyer behavior is an emotional factor and thus difficult to measure.
Buyer behavior is best understood by people, not algorithms—those who dance cheek-to-cheek with this emotional response to homes every day: Buyers themselves and the agents who serve them. Buyers with boots on the ground (versus “armchair” buyers) can get so good at determining sales prices that I often marvel at their accuracy and ability to succeed. Data is great, but not when it is wildly inaccurate or unreliable (Zillow, are you listening?).
Here are a few examples of some recent sales in our market, showing the list price, sold price, Zillow estimate and RedFin estimate.
1332 McGee, Berkeley
LIST: $980,000 | SOLD: $1,607,332
ZILLOW: $936,534 | REDFIN: $1,256,805
1717 Rose Street, Berkeley
LIST: $749,000 | SOLD: $1,040,000
ZILLOW: $814,945 | REDFIN: $1,003,551
60 Arden Road, Berkeley
LIST: $1,049,000 | SOLD: $1,450,000
ZILLOW: $759,382 | REDFIN: $925,841
7309 Potrero, El Cerrito
LIST: $799,000 | SOLD: $986,000
ZILLOW: $763,482 | REDFIN: $913,915
1 Fernhoff Court, Oakland
LIST: $1,195,000 | SOLD: $1,325,000
ZILLOW: $1,442,220 | REDFIN: $1,262,594
134 The Uplands, Berkeley
LIST: $1,595,000 | SOLD: $1,595,000
ZILLOW: $1,908,308 | REDFIN: $1,884,549
156 Hill Road, Berkeley
LIST: $1,986,000 | SOLD: $2,658,000 (!!!!!)
ZILLOW: $1,194,120 | REDFIN: $1,040,948 (!!!!!)
1484 Walbrook Dr., San Jose
LIST: $1,899,000 | SOLD: $1,850,000
ZILLOW: $2,241,809 | REDFIN: $1,860,688
