7 Free Home Value Estimators Tested. Were They Accurate?

In a previous article on RealEstateCompsToday.com we noted the costs associated with inaccurate home value estimates for sellers and buyers.  More Accurate Than Chase Home Value Estimator was the only site that offered both the speed and flexibility of the online guesstimator sites with the accuracy associated with a real estate agent’s home value comparison report.  Another article tested 7 of these tools, including Chase, Bank of America and Zillow.  Here are some of their findings and their methodology was simple enough for anyone to retest.

When you plug your home’s address into one of the many free home value estimators available online, a lot of people simply accept the location-based figure it gives us at face value. It might be shockingly low or breathtakingly high. We then start to make life-altering decisions about whether we should sell our home based on this one opinion.

Richard Batts, one of central Florida’s top real estate agents, says, “there is no way you can accurately give an estimate on the price of a home by using a free home value estimator — they are very, very misleading.”

According to US News & World Report, there are at least half a dozen reasons online home value estimators so often fail to hit their mark.

Among these reasons are the uniqueness of a home compared to others in the neighborhood, a rapidly changing market and a general lack of data for your location.

They decided to put on their proverbial lab coats and do the ultimate experiment on the leading free home value estimators:

  1. Zillow
  2. Eppraisal
  3. Bank of America
  4. Chase
  5. Fifth Third Bank
  6. Realtor
  7. RE/MAX

These tools do not require you to register for an account nor provide any personal information.

The guinea pigs include five properties located throughout the US, all of which were last sold about two years ago:

  • A 1-bedroom condo in New York City
  • A 4-bedroom house in southern California currently owned by a celebrity
  • A 3-bedroom townhouse in Cleveland, OH
  • A recently constructed 5-bedroom mountain chalet in Vail, CO
  • A 4-bedroom house in one of the “most American towns in America,” Wichita, KS

Home Value Estimate Experiment #1:

1-bedroom condo in New York City’s Financial District

Background: This unit was purchased in June 2014 for $999,000. It boasts one bedroom, 1.5 baths and just under 1,000 square feet.

Our home value estimators produced the following results:

  • Zillow’s Zestimate: $1,244,350
  • RE/MAX: $1,214,000
  • Epraisal: $1,133,596
  • Fifth Third Bank: $1,082,000
  • Bank of America: $1,008,593 – $1,309,988
  • Realtor: No estimate
  • Chase: No estimate

Total discrepancy:$301,395 Average:$1,165,421

While there is a range in values, all estimates agree that the price has increased from the time it was last sold. Overall, not a terrible outcome.  Although it’s interesting that already, within the first experiment two tools didn’t even try.  Ourleading alternative home value estimatorsite didn’t get polled at all in this and already is as accurate as Chase.

Home Value Estimate Experiment #2:

A 4-bedroom house in Calabasas, CA currently on the market. (Current owner: Kourtney Kardashian)

Background: Bought by the oldest Kardashian sister in 2014 for $2,975,00, this house has 4 bedrooms, 5 bathrooms and is a whopping 5,400 square feet.

  • RE/MAX: $3,291,600
  • Fifth Third Bank: $3,167,000
  • Zillow’s Zestimate: $3,008,782
  • Epraisal: $3,005,929
  • Bank of America: $2,842,283 – $3,473,901
  • Realtor: $2,722,795
  • Chase: $2,432,480 – $2,855,520

Total discrepancy:$1,041,421  Average:$2,993,096

This is a very big difference. In four of the estimates, Kardashian makes money on the sale. In two of the estimates, she loses money.

Home Value Estimate Experiment #3:

A 3-bedroom townhouse in Cleveland, OH

Background: This 3-bedroom, 4-bath townhome has over 2,000 square feet (and an elevator!) It was purchased in 2014 for $325,000.

  • Realtor: $343,094
  • Fifth Third Bank: $317,00
  • Zillow’s Zestimate: $299,512
  • RE/MAX: $295,000
  • Chase: $289,520 – $326,480
  • Epraisal: $287,991
  • Bank of America: $245,000 – $384,125

Total discrepancy:$139,125 Average:$308,840

Once again, these estimates show the potential for the owner to make and lose money if they were to sell now. Bank of America’s range provides the high and the low for this property.

Chase Home Value Estimator

Chase’s Home Value Estimator required a disclaimer essentially disavowing any trust in the tools accuracy. The alternative to Chase Home Value Estimatorsite has no such disclaimer.

Home Value Estimate Experiment #4:

A recently constructed 5-bedroom house in Vail, CO

Background: This 5-bedroom, 6-bath chalet is over 5,300 square feet and has unobstructed views of the mountains. It was built in 2014 and sold to its owner last year for $4,750,000.

Zillow’s Zestimate: $5,098,606

Fifth Third Bank: $4,626,000

Bank of America: $3,492,607 – $5,946,927

Epraisal: $2,583,036

Realtor: $1,780,382

RE/MAX: No estimate

Chase: No estimate

Total discrepancy:$3,318,224 Average:$3,921,260

The online estimators didn’t know what to make of this one. Perhaps because it was built so recently or because there aren’t much sales data on the neighborhood, the estimators failed us greatly here.

Home Value Estimate Experiment #5:

A 4-bedroom house in the heartland

Background: With 4 bedrooms, 3.5 baths, and over 3,100 square feet, this family home was sold last year for $230,000.

  • Zillow’s Zestimate: $274,058
  • Realtor: $273,980
  • Fifth Third Bank: $250,000
  • RE/MAX: $237,400
  • Epraisal: $236,499
  • Chase: $204,680 – $271,320
  • Bank of America: $108,783 – $301,171

Total Discrepancy:$192,388 Average:$239,766

Once again, Bank of America provided the highest high and the lowest low in their range. However, 5 of the 7 tools provided relatively close estimates.

What did we learn from all of these free home value estimators?

The site that conducted these experiments concluded…”We learned free home value estimators shouldn’t be the final say in your decision to sell your home, but they’re a good place to start. If the property in question isn’t new construction, and it’s located in an area with plenty of recent sales data, it is possible to get a fairly accurate idea of its value.

As Batts notes: “[Home value estimators] have no idea what the inside of the house looks like; have no idea what’s been replaced; have no idea if it has a new roof; they don’t have any of that information.”

We also learned that despite their shortcomings, consulting several of these tools can provide a decent average.”

A decent average is great as long as you aren’t selling or buying a home.  Even the Chase estimator site agrees.  Their disclaimer literally says, “it should not be relied upon,”it may as well say “for entertainment purposes only.”  Luckily home buyers, investors and sellers all have an accurate online source. It allows you to use their online system to purchase a comp report provided by an agent in your area.  Typically reports are delivered within a day or two and reports start at about $5.

Considering the total amount of difference in these tests reached $4,992,553 …. that is to say on 5 homes 5 million was off, its important to get accurate estimates.

Backlinks 101 – SEO’s Off-page Often Ignored Power Ranker

First off a little disclosure this article over laps the Backlinks category of the FAQ.

What Are Backlinks?

Backlinks are links from other sites.  Think of them as votes of affirmation.  Only one vote can come from a domain so for SEO purposes it doesn’t matter if there are 100 or 1 link from the same domain one link is the count you gain.  Subdomains are viewed separately…thats why yourblog.tumblr.com isn’t a tumblr backlink.  Now those other links may increase traffic to your site but in regards to SEO value its one vote.  Some call this metric “Domain Pop” … how many different domains link to a site.  It’s also gotten more complicated as people would host multiple sites on a shared IP.  How many backlinks come from different IPs is “IP Pop.”  It’s common to see a little higher domain pop than ip pop but if its a huge gap its suspect.

The more domains that link to you the more authoritative you must be right?  Well Kinda.  If 1000 domains link to your site you likely are more authoritative than a site that 3 sites link too.  Not all domains or votes or backlinks….are the same.  A link to your site from UltimateSEO.org carries with it the weigh attributed to that site by its backlinks.  People refer to this as “link juice” basically the backlinks coming in to a site fuel the backlinks leaving a site.

Link juice prevents someone of registering 10 new domains and making 10 backlinks to their original site because those ten new sites probably lack link juice from their own backlinks.  Generally said though backlinks increase a site’s domain athority or citation flow.  Different companies refer to the authority of a site differently.  Beyond DA and CF there is also LIS but I have found DA to be the best singular indicator of a sites worth.

You can see a site’s backlinks from many indexes, most are paid.  Ultimate SEO recommends Monitor Backlinks if you want a tool that is really good at backlinks.  UltimateSEO received nothing for that endorsement.  The endorsement or vote …. as you see it’s a backlink.

What Kinds Of Backlinks Are There?

No-Follow vs Do-Follow Backlinks

No-Follow vs Do-Follow Backlinks

Beyond saying Good and Bad there are actually a couple to be aware of “follow” or “do-follow” and “nofollow.”  They get their names by the instruction they give search engine crawlers…no follow links mean don’t follow this to that site.  In theory a regular link is a follow link and serves as the backlink you ultimately want.

Some reason folks went a little crazy and no-followed everything … even internal links.  No-follows were meant to combat link building schemes such as blog comments.  While its fine to have no follow links to your site there should be a limited mixture of them in relation to your actual do-follow links.  No-follow links are still indexed and I feel strongly have some SEO value still even if its just to drive traffic to your site.  In the end you want do-follow links because they come as full fledged votes for your site, where as no-follows are more or less saying “here is this link to a sight I don’t want to be associated with necessarily.”

It’s that distance that makes “no-follows” a poor source of SEO efforts and its why you should use them sparingly in internal links.  Why would you send a signal to Google that you don’t stand behind an internal link to yourself?  Some try to hold onto all the link juice coming in and no-follow” every external link, this is a poor practice and its been shown that linking your content to relevant good external content helps you.

No-Follow Internal Links…Just Don’t

I rarely use no-follow links, I kinda think they system there is broken so I just follow them all.  Sometime ago people started no-following everything and lead their link juice to specific pages they wanted to rank.  Since this was a misuse of the no-follow Google changed how it handled no-follows, it doesn’t keep the juice in your site or on a page it just disappears.  No-follows take the same amount of link juice as a regular link but no one gets it.  Pointless then right?  We’ll debate that more another day.

What Is Anchor Text?

Anchor text is the “keyword” of a backlink.  Ultimate SEO for example is anchor text for the link https://ultimateseo.org which that link had no anchor text.  Anchor text defines the backlink vote.  If enough people make a link to your site like “Miserable Failure” it will teach Google that the target of that link is a miserable failure.  This happen to George W Bush’s White House biography page long ago and is called a “Google Bomb”.  It’s that old saying…if you say something often enough it can become true.

How Many Do I Need?

A lot.  You need as many as you can get from as many places as you can get them.  Just keep in mind that a backlink from my personal site isn’t as powerful as a backlink from the CDC.gov website …. they have the authority.  Thats also why .edu and .gov backlinks are especially coveted.

Backlinks

Backlinks

A quick rule of thumb to determine how many you need is to simply Google the keyword you are attempting to rank for….lets say “cool music from the 60s.” I get pastemagazine.com leading the pack.  According the SEMrush.com that site has 2.7 million backlinks coming from 36,700 domains on 44,300 IP addresses.  So roughly keep that your target if you want to rank #1 for “cool music from the 60s.”

How Do I Get Backlinks?

Many ways….the Gods honest truth is to do it the obvious way …. by having content worth linking too.  If you want a page to rank at the top you need a site thats fast, optimized on page, has relevant … awesome content … and people will backlink to you.  Over years and years and years and you’ll need to keep that content better than everyone else’s … thats not super realistic though.  Sometimes the best content is on page 2 and it’ll stay there…I often Google something and skip the first things just cause they are often just the most SEOed things.  BUT most people by far pick the first result, then the second and so on.

What Are Some Popular Link Building Techniques?

So you need to prime the pump and simulate organic growth and popularity and now you’re in a link building scheme.  Some are looked down upon more than others but make no mistake any attempt to gain backlinks is a link building scheme.  Press Releases, Guest Blogging, Commenting in Forums, making profiles on other sites, link swapping, selling or buying links and finally PBNs.  PBNs are private blog networks where you make zombie sites that link to your important site … but considering that the example above had 37,000 domains linking to it how effective is a network of say 200 sites?  Well surprisingly effective…and thats why Google hunts PBNs like Buffy the vampire slayer.

Thats our Backlinks 101…I’ll talk more about some of these concepts in future posts.

Ultimate SEO”

https://matt2.info/backlinks-101-seos-off-page-often-ignored-power-ranker/