Santa Clara, CA: Zillow, a real estate website that provides estimates of property values, is facing allegations of consumer fraud, based on Zillow’s Zestimate valuation tool which allegedly misrepresents properties’ real market values.
A possible class action lawsuit brought by customers Vipul and Jyotsna Patel and Schaumburg-area developer Castle Builders in Illinois has been brought, which claims that Zillow’s Zestimate tool unlawfully publishes incorrect estimates of property values, which misleads potential property buyers and thwarts efforts by property owners to sell their properties.
Based in Seattle, Zillow Group’s Zestimate tool works by generating an estimated value for a given property, regardless of whether or not that property is on the market. The estimate is achieved by applying a proprietary algorithm to publicly-available information, such as statistics from county assessor’s records. The resulting property’s Zestimate value is then published on the Zillow real estate marketing website.
According to allegations made in the proposed class action, property owners have been criticizing Zestimates for years, claiming the estimates can be wildly inaccurate. While Zillow admits to a median error rate of five percent, allegedly, the margin of error for their estimates can be 30 percent or more from a given property’s real market value.
The allegations against Zillow also claim that potential home buyers treat a Zestimate as a formal appraisal, whether it is one or not. However, Zestimates are frequently 20 percent lower than the property’s fair market value, which creates unrealistic expectations for potential buyers.While the standard appraisal process affords property owners the right to challenge the appraiser’s valuation process, Zillow offers no such comparable process to allow correction of a Zestimate.
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Zillow refuses to remove comperables for my home that are more than 35 year old sales. They have at least three of the ten comparables that configures my "Zestimate" that are each over 20 years old, with the oldest comp being from 1981. How is tnis allowed? I have screen shots of all of these. All of my neighbors home " Zestimates " are rising, and mine has steadily been dropping. My house is the only one for sale. Also, my property is the nicest, by far, on my street, yet the" Zestimate " is the lowest. How is a 37 year old property sale for a undeveloped lot, at all comperable, in 2018, to a custom home in high end neighborhood in Florida? The 1981 comperable sale is $31,000. What a joke!! They have been informed of the errors but refuse to change them.
Posted by Donna Lyn Tamaroff
Zillow has my home valued at $1,524,00 while the property tax assesment is $1,718,000. A November 2016 independant appraisal for mortgage refinancing gave a market value of $1,708,000 qualified because of the lack of comaparable property with water front square footage, views, water access and close proximity to town.
Zillow significantly undervalues my property and continually lists comparables which are not at all comparable.
This is a UNIQUE property!
Donna Lyn Tamaroff
Posted by beverly anderson
yup...that would be me!
Please email if you would like to talk.
Posted by Richard Musgrave
I have counted on Zillow when considering investments
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