The president of Zillow, Lloyd Frink, has blogged a little about the recent complaint filed by the National Community Reinvestment Coalition (NCRC):
We try really hard to be approachable and open about what we’re doing, and take all feedback seriously. So we were surprised (and disappointed) that the group that sent the letter, the National Community Reinvestment Coalition, did not contact us first, and instead sent it directly to the press at the same time it was sent to the FTC.
Zillow is about empowering consumers with information and tools which they have not had access to before. Our Zestimates are designed as a starting point. We say in many places on the site (and next to the Zestimate on every home details page) that Zillow is not an appraisal, but a free research tool for consumers. We’ve also tried to be really transparent since we launched about Zestimate accuracy. We state that nationwide, our median margin of error is 7.2 percent, and 62 percent of Zestimates fall within 10% of the actual sale price of a home. (see accuracy statistics for every county Zillow covers here, or linked off the home page).
We pull these stats by looking at millions of transactions and Zestimates — that’s millions of comparisons — not by picking a handful of examples and drawing broad conclusions that make us look good.
We feel these accuracy numbers are pretty good, but we are working hard to make them better.
As a real estate professional, I see Zillow making every effort to improve their product by truly listening to feedback of both consumers and the real estate industry. I have watched as they shifted from claiming that Zillow was everything a homeowner needed to their newest pitch as a tool to get the homeowner started (much more accurate portrayal of their service thus far).
I do think Zillow has its place in the real estate market as a tool for both consumers and agents to assist in determining an accurate and fair asking price for a home prior to marketing. That said, the biggest improvement that Zillow needs to make is going to be the most challenging… they need to provide more timely and accurate data. I fully support their mission to make real estate market data public, but hope that they can find a more efficient means of ensuring that their data is up to date and accurate.
By the way, I love the new tool allowing the consumer or agent to make adjustments to the Zestimate. Just additional evidence that Zillow is striving to create a better product for their clientele.
And in the big picture, Zillow and companies like it are on the side of the free flow of information. In the long run, that’s very unlikely to hurt consumers.
Some advice for the NCRC… leave Zillow alone and do some snooping at the NAR. Now that’s an organization begging from some oversight.