Trulia has joined Zillow in offering estimates of property valuation. Anecdotally, looking at my own home, I found Trulia’s valuation to be at least 10% high, and looking at a nearby recently sold property, I found their valuation to be over 50% too low. I’m sure, like Zillow, they will get better at their estimates over time, but even 5-10% can be significant, and real estate agents can expect yet more sellers coming to them with pre-computed selling prices that may or may not be realistic, and buyers asking them to put in offers that are too low, based on the automated valuation they found online. Agents that are prepared to respond will look great.
I think the best approach to this was designed by Greg & Dan for their Cloud CMA product. The idea of it is that the agent puts together a list of a few comparable properties that have very recently sold but haven’t yet had the sale price reported to Trulia and Zillow, look up the valuations on Trulia and Zillow, and calculate what percent the automated valuations are “off” from the actual sale price.
If an agent is prepared with that information – a table with just a few columns and rows (obviously more than the two comparables I used for illustration) – they can easily show that the automated valuations don’t track exactly to the list or sale price – and they’ll look great doing it.
Spread the word to the agents … be prepared!
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