A month ago Zoocasa.com launched a features that helped home sellers and buyers a chance to review property values.
By plugging in a street address, the number of bedrooms and bathrooms, the style of the home and the year the home was built Internet users can get an appraisal of what the home is worth, according to the real estate search site Zoocasa.com.
Now, this is long overdue. For decades only realtors have had access to a large database of comparables—now Zoocasa.com is attempting to level the playing field by offering free information on property value information for specific addresses.
But there’s a flaw. A big flaw. The values provided by Zoocasa.com are inaccurate. Consistently.
So, I own two homes in the GTA and used both as a way to measure the accuracy of the appraisal offered by Zoocasa.com. For both homes, the website offered significantly higher appraisals than what current homes were selling for on the street.
For example, for our rental property (near Trinity Bellwoods Park) the website offered an estimated appraisal price of just under $740,000—with a high of $779,000 and a low of $700,000.
But when you compare these appraisal prices to the actual sale prices you get a drastically different picture.
Of the five homes that sold in 2011, the average price was $594,800 with the highest sell price reaching $665,000—97% of the original list price of $689,000.
Now, Zoocasa.com deserves applause for at least trying to provide necessary market intel on home valuations. And their fine print and spokespeople do suggest that their free service cannot replace professional (read: paid) appraisals. Still, I think home buyers and sellers should be cautious of using this or any other free aggregate information, particularly if these free appraisals will be used in setting a list price. Thankfully, when using a realtor, sellers and buyers will get this information automatically—helping them make informed decisions.