Volatile Real Estate Market Driving Web Traffic
Marketwatch video: Zillow upgrades their algo, claiming a 12% improvement. They also are allowing homeowners to improve and upgrade data about their houses:
Thursday, April 24, 2008 | 03:30 AM | Permalink
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Barry, do you not sleep?
Posted by: Don | Apr 24, 2008 6:40:27 AM
Zillow can do all the upgrades they want, but their hokey website with its horribly unrealistic prices (at least from my experience) has no credibility. There is no correlation between what it claims are market values (Zestimates) and comparable sales listed by the county. Just another schill in the game that will fold if housing follows a Roubini-esque recovery. Hopefully these ridiculous house flipping shows that are ubiquitous on cable will go with it!
Posted by: AJF | Apr 24, 2008 6:42:22 AM
I can schedule posts to pop up whenever.
3:30 am is late morning for our UK/European friends . . .
Posted by: Barry Ritholtz | Apr 24, 2008 6:59:47 AM
If they updated their algorithm to make 12% more accurate, to what benchmark are they proving that it's more accurate? ...the "actual" price? Then why not use the "actual" price as the price?
Posted by: VennData | Apr 24, 2008 7:34:48 AM
We can "question" their "prices" all we want, but that is a LOT of traffic coming to their site.
I'll be anxious to hear what sort of traffic their mortgage component gets.
Posted by: Tom Vanderwell | Apr 24, 2008 10:16:42 AM
I recall reading an article months back about people that were serial Zillow checkers. They would literally check their home 'Zestimate' numerous times a day......LOL. Oooh...up $4000...wait.....down $12000........no, up $8000...sell...sell!! Oh wait, no one can get financing...nevermind!
Posted by: Flic | Apr 24, 2008 11:42:56 AM
You cannot fool proof AVMs (Automated Valuation Methods). Sales can take place for any number of reasons and sales price does not always reflect market trends. Ex: A husband and wife divorce. The house is sold to either party at settlement amount. Or, parents sell their home at a steep discount to kids. much more....
Anyhow, these sale price stats are recorded (via county recorder) and made public. Zillow takes this info and uses it to aggregate market value.
Lastly, you cannot account for property amenities that are unique to a particular unit. Ex: View.
Posted by: Portland Refugee | Apr 24, 2008 4:01:45 PM
