Does Zillow provide a good gauge for home values?

Let’s face it, at this point, we all have used Zillow at one time or another. But does Zillow truly provide a good reference point for your home value?

Introduction to Zillow’s Role in Real Estate

Zillow is a company that showcases real estate online for buyers, sellers, or even those looking to rent. Founded in 2014, Zillow is one of the leading real estate tech companies and has transformed the way in which people approach investing in the real estate market as it provides users with a platform for property search, listing, and valuation. 

Zillow’s Home Value Estimates (Zestimates)

The impact that it has on the real estate industry is quite significant. Zillow’s algorithm and how it determines what is called a “Zestimate” is worth taking a look at. 

A Zestimate, or Zillow’s home value estimate, is an estimate of a home’s market value. According to Zillow, the Zestimate is calculated by taking into account various factors such as public property records, tax records, recent home sales in the area, and user-submitted information.

To be more specific, Zillow’s home value estimates take into account various factors. 

Home Details

A Zestimate is determined by the specific qualities of your home, such as the square footage, location, and the number of bedrooms and bathrooms.

On-Market Data

Another factor that is taken into account is on-market data. This will include everything from listing price, description, home in the area, and the number of days the house has been on the market. 

Off-Market Data

On-market data is super important, but now let’s discuss the off-market data. This includes tax assessments, prior sales, and other publicly available records. 

Market Trends

Last but not least is market trends. This factor has everything to do with seasonal changes in demand and the current state of the housing market.

You may be wondering, how accurate is a Zestimate? And is Zillow really a good tool to gauge home values? Due to the fact that Zillow takes into account these variables and weighs in various on-market and off-market factors, their numbers prove to be quite accurate when gauging home values. 

According to Zillow, the median error rate for the Zestimate of U.S. houses on the market is just 1.9 percent. This is an incredibly low statistic. Given that Zillow publishes estimates for over 104 million homes across the country, this is a significantly low margin of error. 

Pros and Cons of Using Zillow for Home Valuations

There are many pros and cons of using Zillow for home valuations. Let’s start by discussing the pros. 


  • Zillow allows you to explore houses in areas that you may have never been exposed to before. You do not have to worry about making travel plans or making tons of phone calls when you have the convenience of Zillow at your fingertips.
  • With Zillow, you do not have to consult an agent before piquing interest in a home. Instead, you are provided an instant estimate of the home value, including photos and an agent, in the case that you need one. 
  • Zillow has a home value comparison feature that allows you to compare the price of your home to similar homes in your area. This is a great way to verify that your Zestimate is not a random outlier and is in a reasonable margin. 
  • Overall, Zillow is super convenient and easy to use. 


  • Zestimates can sometimes be inaccurate, therefore consulting with a live agent may be necessary in order to assess an ideal home value.
  • Many home buyers are now doing was has been coined as “Zillow-surfing,” which is a new term that is used to describe those who are browsing homes online for entertainment or are simply noncommittal.
  • Zillow may not be up to date with a home’s upgrades therefore the Zestimate may not be taking into consideration these factors. Again, consulting with a live agent will help solve these issues. 

Alternative Methods for Assessing Home Values

Zillow is just one application that one may use to gauge home values. As we have mentioned in this article, it is super important to cross reference other platforms or consult a live agent to verify credibility and assess home values with confidence. 

Alternative applications for assessing home values are, Redfin, Trulia, Homesnap, Loopnet, and Homescout, to name a few. 


Of course, the traditional method of hiring a real estate agent and consulting with them on the go is an option you may consider. You may even consider consulting a real estate professional for their personal views on Zillow’s role in the real estate industry. Ultimately, Zillow has a powerful role in the real estate industry, and its methods for assessing home values prove to be reliable.