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Zillow faces lawsuit over ‘Zestimate’ tool that calculates a house’s worth

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Re: Zillow faces lawsuit over ‘Zestimate’ tool that calculates a house’s worth

#231

Post by blocacres »

lotsofpulp wrote: post #10
cavanasm wrote: post #5

I wonder how many other tech companies fit into this general category of "providing an equivalent to a regulated service without meeting the regulations". You've got the more obvious "sharing economy" type things which are in the news all over the place lately, but I bet there are a bunch of other companies like Zillow that have been flying under the radar for a while.

If a homeowner or homebuyer is paying someone to assess the value of a property, requiring expertise and training in inspection of a house such as materials, build quality, plumbing and whatnot, I could understand needing government approval. This is just someone saying what they they think something is worth. Do I need a license before I can say "I think a certain car is only worth $25k instead of $30k"?

A home appraisal is not the same thing as a home inspection, the latter being much more thorough,looking for condition of home mechanics, and structure.

Re: Zillow faces lawsuit over ‘Zestimate’ tool that calculates a house’s worth

#232

Post by LordKano »

strictnein wrote: post #19

The 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 just looked at my house and I think the Zestimate is too high.

I bought the house 9 years ago and the Zestimate is about $10k more than I paid. It's right in line with what the previous owner was asking when he sold it but I wasn't willing to pay that and I likely couldn't sell it for that much.

Re: Zillow faces lawsuit over ‘Zestimate’ tool that calculates a house’s worth

#233

Post by coredog64 »

mattkrause wrote: post #25
_m8fo wrote: post #16

You 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…

If you want to try it, there are a few data sets kicking around, including a) https://www.kaggle.com/c/house-prices-advanced-regression-te... b) http://www.bis.org/statistics/pp_detailed.htm c) https://archive.ics.uci.edu/ml/datasets/housing If you had a really great model, you might be able to make some money with it--find underpriced (per the model) houses, buy them, and then try to sell them at the model's price.

Isn't that similar to the model for Opendoor?

They buy houses from owners at a fixed price and then need to turn a profit on it. Therefore they need to have a good idea of what the eventual selling price will be.

Re: Zillow faces lawsuit over ‘Zestimate’ tool that calculates a house’s worth

#235

Post by mfringel »

michaelmrose wrote: post #211
wyattpeak wrote: post #206

Earlier quoted context omitted.

There's a difference between an opinion proffered by a neighbour and an opinion from a large real-estate company. The reality is people do trust the site, so law should take that into account. If a situation is making life harder for actual people, the fact that their behaviour isn't economically rational is not a good enough reason to ignore the problem.

Zillow is a information company providing a free ballpark estimate of a vast array of properties, not a real estate company. This is an important distinction. Neither party is paying them for an accurate estimate ergo they are not obligated to provide an estimate sufficient for either buyer or seller, which is why both sides are best advised to PAY for an accurate estimate before closing a transactions worth hundreds…

...and Uber is just a software company, and Mastercard/Visa just facilitate payments.

The specific classification of a company is irrelevant. If they've induced their own gravitational field, then they're responsible for the consequences.

Re: Zillow faces lawsuit over ‘Zestimate’ tool that calculates a house’s worth

#236

Post by jandrese »

EpicEng wrote: post #104
wuliwong wrote: post #60

Earlier quoted context omitted.

Usually this is mitigated by the appraisal. Lenders generally aren't willing lending more than a home is appraised for because of the increased risk. I'm sure this varies from state to state but I think this holds mostly true in general. That being said, the appraisals themselves are quite subjective and only based off a few similar properties sold recently, so I still agree it's a difficult problem.

Appraisals magically come in at the exact offer price unless the offer is just completely off the charts insane. Appraisals are often times BS or, at best, just whatever you need them to be within some rather large margin (+/- 10%? 20%?).

When I sold my last house I had no idea what it was worth (the market was going crazy at the time) so I called an appraiser to see if he would give me a good starting point.

The first question he asked was what I was listing it for. He also made it clear that he would not physically inspect the house or do anything more than a cursory comp search.

Real estate sales are just loaded down with parasites looking to skim off of every transaction. IMHO it is an industry badly in need of disruption, but sadly a lot of the middlemen have their positions enshrined in laws, regulations, and corporate policy. Another good example: why do we pay Realtors a percentage of the sale price instead of a fixed rate? They're basically glorified babysitters that are just there to make sure you aren't stealing everything from the homes.

Re: Zillow faces lawsuit over ‘Zestimate’ tool that calculates a house’s worth

#238

Post by Mathnerd314 »

gnicholas wrote: post #218
Mathnerd314 wrote: post #210

Earlier quoted context omitted.

> nor does this Act apply to the procurement of an automated valuation model. "Automated valuation model" means an automated system that is used to derive a property value through the use of publicly available property records and various analytic methodologies such as comparable sales prices, home characteristics, and historical home price appreciations. If that sentence applies, I don't think they really have a cas…

Good point. But what does "procurement" mean in this context? The plain meaning is "obtain", but that doesn't really make sense here. The word isn't used elsewhere in this document but is presumably defined somewhere. If it is interpreted to mean "use", then the case is a loser as you say. But I wouldn't want to be the lawyer tasked with arguing to the judge that "the legislature meant 'use' but decided to say 'procu…

Generally in law you use a law dictionary, e.g. http://thelawdictionary.org/procurement/, which defines it as "the entire process of purchasing goods". "Entire" there suggests a broad term, hence interpreted inclusively in the context it appears. So in context it's probably something like "commercial use". But there are other questions of applicability, e.g. whether the legislature intended that sentence to only apply to financial loan decisions. It seems like there's no indicator of legislative intent on the original bill https://openstates.org/il/bills/96th/HB1015/, hence it would probably be the plain meaning as an independent clause, but IANAL...

Re: Zillow faces lawsuit over ‘Zestimate’ tool that calculates a house’s worth

#240

Post by scott00 »

SolarNet wrote: post #219
gnicholas wrote: post #218

Earlier quoted context omitted.

Good point. But what does "procurement" mean in this context? The plain meaning is "obtain", but that doesn't really make sense here. The word isn't used elsewhere in this document but is presumably defined somewhere. If it is interpreted to mean "use", then the case is a loser as you say. But I wouldn't want to be the lawyer tasked with arguing to the judge that "the legislature meant 'use' but decided to say 'procu…

I'm not sure I understand your point. By visting the website one is procuring the estimate through an automated model in return for the ads and tracking you agree to by visting. Legal language is straight forward in this case.

Procuring an estimate produced by an automated valuation model is not quite the same thing as procuring an automated valuation model.
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