Agi Anderson, the Florida Property Diva and the curator of Space Coast Real Estate Scoops, recently sold a home in Cocoa Beach. Agi sent the seller an RPR Value Report from the local multiple listing service that stated $325,000 as the value. The seller was somewhat shocked because the Zestimate she checked on Zillow showed $386,000 as the value.

The problem is, owners believe that the Zestimate is accurate and it takes considerable persuasion to get them back to reality of what the true value is for their property.

Zillow CEO Spencer Rascoff may have recently given real estate agents like Agi a gift they won’t soon forget: a sure-fire way to show that Zestimates can miss by a mile. How? By selling a property for much less than its Zestimate.

“The fact that we missed and there are empirical reasons we missed — that’s a great conversation that real estate agents should have” with consumers, he said, citing the property’s irregular lot and location on a busy road as partly responsible for its Zestimate’s inaccuracy.But he expressed hope that, in the same discussion, agents also won’t instill “data nihilism” in consumers, and that they acknowledge that humans also can miss the mark.

Key Takeaways

• Agents can demonstrate the Zestimate's shortcomings by showing the discrepancy between the sales price of a home formerly owned by Zilow CEO Spencer Rascoff and its Zestimates.
• Luxury home Zestimates are more likely to be off than others due to 'non-quantifiable facts.'
• Irregular lot sizes or proximity to 'arterial' roads can sometimes throw off Zestimates.