Zillow Q&A
By: Spencer Rascoff CFO & VP of Marketing | March 16, 2006
I was in New York earlier this week speaking at two Wall Street conferences (the JP Morgan Internet Conference and the Stifel Nicholas Consumer Conference) and then in Bellevue, Washington, last night speaking at the MIT Enterprise Forum. I told the Zillow story and explained the background of the company and that in the beta version we’re showing Zestimates for most homes in the country.
All three sessions were well attended, and the Q&A was lively. The questions from the audience were similar to the questions our customers have been asking us here on this blog, including things like:
- “How do you come up with the Zestimate?”
- "What if my data is wrong?" (Report it to us)
- "Is Zillow good or bad for real estate agents?"
Because these were Wall Street crowds (hedge funds, mutual fund managers, stock analysts and the like) they were also interested in what impact Zillow might have on other companies in the sector.
They also asked one question which I don’t think we’ve answered on the site: “What happens to Zillow in a slower real estate environment?” This is an interesting question, and frankly we debate it ourselves internally. The bull case is two-fold:
First, in a more stable price environment, rationality and research reign. And Zillow is all about enabling that research — providing home buyers and sellers with tools and information to buy and sell homes. Tools like Zillow are more likely to be used when price rationality is present. In other words, research is less important when buyers are just blindly bidding 20% more than asking price (which is kind of what the last few years have been like, especially in markets like San Francisco, San Diego or Las Vegas).
It’s kind of like when investors were bidding up internet stocks like mad in the late 90s – they weren’t seeking out tools to help value stocks, they were just throwing money at things. So if/when things slow down, Zillow will be more useful then ever.
Second, real estate professionals will need to market their services more than ever if/when the market slows down, which means there will be even more interest in partnering with us (via advertisements or in other ways) in order to reach you, our visitors.
The bear case says that when markets are slower, people tend to be less interested in the value of their house. This is undoubtedly true – how often did you check your stock portfolio from 1997-2000? If you’re like me or my grandmother, probably a couple times a day. From 2000-2003? Hardly ever. Suddenly my grandmother stopped watching CNBC. Despite the reduced “general interest” in home valuations that would occur if/when markets slow down, we still think that Zillow will be a critical tool for buyers or sellers. So maybe we’ll get fewer people fantasizing but we’ll get as many real buyers and sellers as ever.
- Stumble it!
- Categories: FAQ, Real Estate Industry, Zestimate, Zillow
Comments
10 Comments so far
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Seattle's Rain City Real Estate Guide on March 16, 2006 1:17 pm
Corporate Personalities on Display at the MIT Forum
Brief overview of the event
Moderator:
Jim Reppond, a Residential Real Estate Agent of Coldwell Banker Bain
Panelists:
Nikesh Parekh, VP of Corporate Development of HouseValues
David Eraker, Founder of Redfin
Spencer Rascoff, CFO of Zillo…
Jimmy Gambier on March 17, 2006 12:27 pm
I attended the Bellevue session and was hoping to get some insight into what you guys were going to do next. I also found your stance that agents will always be around interesting. So what’s next
omshom on March 20, 2006 7:29 pm
Why are valuations way off?
They seem to rely mostly on the recent sales data than anything else. Even if I did a CMA of few properties, I’d come up with a better valuations of homes.
http://omshom.blogspot.com/2006/03/why-is-zillow-skewed-since-my-last.html
kthor on March 21, 2006 12:30 pm
lovely Blog … I like the zillow Idea but the numbers on 89% of homes are wrong..Like to sell my home for $100k more but…..
Thanks and let’s get those numbers right!
http://www.JohnHomesOnline.com
http://www.Stateof-California.com
http://www.Theforeclosuresinfo.com
http://www.Bay-Area-Cash.com
John Brown on April 4, 2006 3:35 pm
I love the idea of Zillow, but still have some reservations about how reliable the Zestimate can be.
I recently contested my home’s assessed valuation, and received a reduction on my tax bill. In the process, I was surprised to find a significant degree of inconsistancies in the county data.
When I discussed this with the county Assessor, I was further surprised to find that their method of valuation was not at all consistant with my perception of how my local real estate market determines value.
I was also led to believe that each county and assesor has their own method for determining value, and that there may be little consistancy between county methodologies.
How does Zillow overcome data inconsistancies from official sources of data?
How do you balance available market data with assessor data?
Darrell Childers on April 13, 2006 3:48 pm
My house is listed as having 6 rooms and 1507 square feet, valued at $155k. In reality, my house is 9 rooms, not counting bathrooms and 2430 square feet. When I use your tool to update the specs, the value increases to 247k. I’ve asked twice to get the data updated. Why won’t you update my data before someone sees it on your site and decides it’s too small. I’m trying to sell my house and would really like people to look at it and decide, not use your erroneous data and decide not to even look.
Gresham Homes on December 24, 2007 3:41 pm
I use some zillow tools on my site. It works great. But ultimately clients still need a pro to get the correct value. I think zillow is a great tool for sellers just thinking about selling.
Tonny on December 28, 2007 1:36 pm
Sorry Zillow but I think you guys are very inconsistent on your values and information. I as a Realestate agent have to answer for my actions so I have to make absolutely sure that when I give an opinion it is base on solid well based information. I have seen you estimates all over the spectrum. In such a volatile market your hurting more so than helping, you should ether get it right or get it off the internet.
Furthermore you should at least put a link for those you are misinforming on
Drew Meyers on December 28, 2007 2:01 pm
Tonny-
I’m not sure where you are based, but zestimate accuracy does differ by area. Please also note the value range that we provide with every Zestimate. More details on that here.
Regarding the link, there is a link to the Data Coverage and Accuracy page from the footer of every page on Zillow.
Metrujectiktus on March 29, 2008 9:14 am
Приветствую всех!
У меня такой вопрос,кто что интересное подскажет буду признателен.
Мы с друзьями собираемся поехать в круиз по просторам России и ближнего зарубежья месяца на два на своих машинах,но не как не можем согласовать маршрут,если у кого уже был опыт такого путешествия,может,что посоветуете.Девчонок с собой не берем,думаем,что во все городах России с этим не будет проблем,если у кого будут рекомендации и в вопросе отдыха с девушками тоже буду признателен.
С уважением Сеньчик