Someone fighting back against Silicon's Valley nonsensical idea of ignoring laws? This will totally end well! /s
Zillow is a Seattle company, or are all tech companies just considered to be part of Silicon Valley now?
Zillow faces lawsuit over ‘Zestimate’ tool that calculates a house’s worth
71–80 of 265 posts
Re: Zillow faces lawsuit over ‘Zestimate’ tool that calculates a house’s worth
#72Earlier quoted context omitted.
If it's not correct, then the sale price will reflect that and Zillow's reputation will take a hit. Don't understand why the government needs to get involved in what someone says something is worth, it's their opinion and they're entitled to it. Edit: It would be funny if Zillow also started putting up alerts about problems with government finances which will likely impact future taxes, such as in Illinois.
The government's not getting involved, oh you mean the fact that a judge is going to be involved? Civil courts exist to provide monetary damages if damages can be proved to exist. Yes, they can also compel arbitrary behavior as a part of governing body. This is independent of any stance on Zillow and a state licensing regime. If the plaintiff can convince that the tool is making her lose money, the judge will award h…
> Civil courts exist to provide monetary damages if damages can be proved to exist.
Civil courts exist to provide remedy for non-criminal violation of the law; award of damages (actual, statutory, punitive, or otherwise) is one form of civil remedy, but not the only one available.
Re: Zillow faces lawsuit over ‘Zestimate’ tool that calculates a house’s worth
#73The Zillow estimate used to be spot on in our neighborhood, for several years even. Recently they all plunged to 10-20% below market value, even though all sales data puts it at the previous mark. The weird thing is that they also went back and recalculated old "Zestimate" data as well. On April 2nd the estimate for our house was $617,453, which is more or less what it would sell for. It had been above $600k since Ju…
I live in a hot real estate market (L.A.), and I've spent about 5 minutes (no exaggeration) looking online at the prices of houses in my neighborhood, knowing the actual closing price of recent sales, and my first thought was that prices were about 10-20% below market value. It's funny that this is obvious to someone like myself who has spent virtually no time dealing with real estate, let alone people heavily entren…
This is the same in Seattle, where a house's asking price can be 550, its zestimate (or Redfin estimate) will be around 570, and the price it actually goes for invariably ends up around 700. This has been the case for months, and it can almost seem like some sort of conspiracy between realtors and these meta-agencies to game the market. There are plenty of comps that show prices are WAY above what the 'estimates' show, and yet these professionals are seemingly oblivious. Fear of another 2008? Too much success drumming up bidding wars by underpricing? Whatever the reason, it's pretty infuriating as a buyer because it creates a sort of information asymmetry which makes a major decision really painful.
Re: Zillow faces lawsuit over ‘Zestimate’ tool that calculates a house’s worth
#74Earlier quoted context omitted.
This is a lawyer, who can sue people at very low cost compared to the rest of us. If this is a regulated activity, it absolutely shouldn't be. This reminds me of the absurd barber regulations.
this should be. it's a market with few sales at high costs heavily interwinded with the mortgage market. having a de facto monopoly on what's considered a fair value, rightly or wrongly, opens up bank people and real estate agents to all kind of manipulation. by manipulating their equation they can help lowball the sales price of an entire area, they can both profit directly out of this, indirectly through stock mani…
But how does getting an appraisal license protect bank people and real estate agents? Isn't an appraiser subject to the same moral shortcomings as any regular person?
And only allowing state licensed appraisers to give value estimates does exactly what you are trying to avoid. It creates a state owned monopoly on housing estimates.
Zillow would lose credibility and it would hurt the core of their business if it was found that they company was purposely deceiving people about the value of their homes so that they could directly profit from it. They might also open themselves up to legal repercussions in that case for just plain old fraud as well.
Re: Zillow faces lawsuit over ‘Zestimate’ tool that calculates a house’s worth
#75Earlier quoted context omitted.
This is a lawyer, who can sue people at very low cost compared to the rest of us. If this is a regulated activity, it absolutely shouldn't be. This reminds me of the absurd barber regulations.
Surely most regulations are in place because someone at some point in time tried to take advantage of someone, yes?
No.
Re: Zillow faces lawsuit over ‘Zestimate’ tool that calculates a house’s worth
#76You would think real estate would prove to be one of the few real life fields where machine learning would be able to predict the prices pretty accurately. You have: 1. List price 2. "Favorites" on the MLS. 3. Square footage 4. Bedrooms 5. Bathrooms 6. Sold price for nearby properties 7. Sold price for nearby properties relative to their list price And the list goes on... Is it that difficult to predict? Literally th…
In some areas where houses were developed around similar times to similar plans this works. But, for example, here in Berkeley the price per square foot can vary wildly based on the condition of the homes. We have 100 year old homes that are barely habitable next to completely remodeled ones that can sell for a difference of $200 per square foot.
This is why each property is valued on a sq. foot cost. It naturally includes the "depreciation" of the structure and the land cost.
1. empty buildable lot (with zoning restrictions on max # buildable sq. feet) 2. tear down (add demo fees and maybe requirement to retain existing foundation to avoid extra taxes). 3. rehab 4. new construction
Which is normalized by location... rehab may cost more then new construction depending on the location and if it was a flip.
A $1m tear down can become a $2m+ house, or 4-5 $500k condos.
Re: Zillow faces lawsuit over ‘Zestimate’ tool that calculates a house’s worth
#77As long as there are already many anecdotes, I'll just add mine (I've always taken the zestimate as Zillow's working model that probably needs lots of tweaking; it's not like the MLS's are eager to give them data). Anecdote: My folks live in a golf course neighborhood where their house is not on the course, and it's smaller than the rest. However, my folks house is valued based on these extravagant golf-course side p…
Do you see Redfin eating a traditional realtor's lunch?
This is an obsession of mine, but I'm not a professional. I dated/ lived with a Realtor for ~20mo, and I asked lots of questions about the workflow of the business.
I don't think Redfin has much of an edge in go-to-market strategy. Redfin's allows for more comprehensive data (MLS access because of membership), and Zillow's allows for scalability. Sales data sometimes show 3 months lag from time of transaction and entry into the county clerk's records which gives the MLS quite an edge itself.
Re: Zillow faces lawsuit over ‘Zestimate’ tool that calculates a house’s worth
#78You would think real estate would prove to be one of the few real life fields where machine learning would be able to predict the prices pretty accurately. You have: 1. List price 2. "Favorites" on the MLS. 3. Square footage 4. Bedrooms 5. Bathrooms 6. Sold price for nearby properties 7. Sold price for nearby properties relative to their list price And the list goes on... Is it that difficult to predict? Literally th…
You don't really need machine learning to do comps. There are literally dozens of tools to do this accurately. Zillow just sucks for a variety of reasons that have more to do with Zillow than anything else.
I think the difficulty is scaling the "art" of estimating prices. Any single home I could sit down and give a good estimate but to come up with a fully automated way to do that seems pretty tough still. I'm also not sure that the really hard parts are solved with ML as well.
Re: Zillow faces lawsuit over ‘Zestimate’ tool that calculates a house’s worth
#79I'd also like to know how or why Zillow lists houses that are "pre-foreclosure". I know it's semi-public record, but that certainly doesn't help the homeowner try and recover maximum value for their property if they decide to sell. On top of that, it's pretty unnerving when you see this pop up for one of your neighbors and good friends. Nobody should have to go through even more humiliation than they already are.
If you ever hover over the URLs, Zillow is using a 3rd-party service for the forclosure potential properties. It's lead gen, and you have to become a customer to get actionable data.
Re: Zillow faces lawsuit over ‘Zestimate’ tool that calculates a house’s worth
#80The estimate for my house dropped by 25% in one month when the market was still rising. I'm assuming that the cause was the house next door which was in poor condition and was sold for about 20% below market value. The buyer put $100k into the house and is now selling it above market value ($200k more). It will be interesting to see what the zestimate for my house will be when the other house sells again. (It will probably sell within a month.)