The advancement of tech-based real estate services such as Zillow, Realtor.com, Redfin along with others, has allowed customers to easily research and estimate the value of their homes without involving a Realtor or an Appraiser. The question is, are they accurate? Property valuations are the most integral part of a real estate agent’s business. You may find, or already use, easy and quick ways to determine property values. One such method is using an AVN or automated valuation model. Many options are readily available and you will want to know how an AVM can benefit you and who the top providers are.
A real estate automated valuation model is a machine learning-based system that examines various data points to determine the worth of a particular property.The information examined often includes details of the property, comparable sales data, the property’s age, market trends and more. There are many available real estate AVMs on the market. Zillow’s “Zestimate” is the most popular.
Zestimate is a key feature offered by Zillow and one of the first AVMs made available to the general public. The feature caused some controversy when it was first introduced, particularly among real estate agents. Since then, Zestimate has become so prevalent in clients’ minds that agents frequently intentionally bring it up during listing presentations, detailing why it is either high or low or, perhaps, exactly right.
The main benefit of Zestimate is it gives the user a basic idea of the value of their home. On the other hand, Zillow’s estimates frequently rely on data submitted by users; and as such, they are only as reliable and accurate as the information or data given. Users’ errors or omissions can jeopardize the accuracy of the data. Other common real estate AVMs available are: Realtor.com’s AVM; Trulia’s AVM; CoreLogic Real AVM; House Canary; Realtor Property Resource (RPR); Homesnap; Freddie Mac Home Value Explorer; ATTOM Data Solutions; Collateral Analytics (Black Knight); Veros; Quantarium (Xome); Clear Capital.
AVMs should not be used to give a home’s final value. They only provide estimates and can be misleading. Any AVM should be described as an estimate. Most of the commercial sites use them as a catalyst, not a stand-in, to encourage website visitors to contact one of their subscribed agents and to sell leads, as these are one of the many ways AVMs make their money. AVM estimates are not intended to take the place of a more thorough property evaluation that involves an in-home inspection and a detailed comparative market analysis (CMA) from an experienced agent. Actually, AVMs are a starting point when determining values that you, as a Realtor, will be able to adopt in order to establish yourself as a pricing expert in your area and escalate you business. Maybe you should incorporate two to three AVMs when doing listing presentations, thus presenting to the homeowner how these AVMs can vary in valuations and then take another step to show a more detailed CMA (Comparative Market Analysis) that factors in details like home improvements, functional obsolescence, desirable/undesirable lot, etc. This is especially important in areas that are not homogenized like large cities where AVMs often use a condo as a comparison for a single-family home which can really skew the numbers.
1. Realtor Property Resource: RPR a free online tool that helps Realtors estimate a home’s value based on the property’s features, renovations and the housing market. This tool can also assist consumers in deciding whether it is cost-effective to buy a house and later remodel it.
Realtors can use the report obtained to educate prospective buyers and sellers regarding what the local market offers, which helps set reasonable goals. So far, there are no significant pitfalls, but it needs to be updated often for easy navigation.
2. CoreLogic RealAVM: RealAVM is one of CoreLogic’s efficient and easy-to-use products. It provides the first glimpse at recent house price movements, providing an initial baseline for appropriately valuing collateral (and mortgage risk). The RealAVM is just one component of the property information sheet for real estate agents using CoreLogic’s Realist software; it is not a consumer-facing AVM but a great tool to use for determining value.<span>
3. ATTOM Data Solutions: ATTOM is a trustworthy source for reliable, nationwide real estate data. It offers analytics-ready data for real-world applications with flexible delivery solutions like ATTOM Cloud and one of the market’s top real estate data APIs. Your individual needs, opportunities and goals will be met by ATTOM’s adaptable property data delivery solutions. Through a range of delivery methods, ATTOM Data can quickly establish data management processes and address your real estate data needs.
Major AVM providers highlight their precision, thoroughness and time-saving abilities. But AVMs work with averages. They are, therefore, instrumental in areas with fairly uniform property stock. On the other hand, they might not be as precise or helpful in areas with a wider variety of homes. While their use is expanding, AVMs have not replaced human valuation estimates and will never compete with a Realtor-made CMA. Take advantage of these useful information resources, but then show your value as an expert real estate home evaluator with detailed and accurate pricing derived from your CMA. You will impress your clients and boost their confidence in you. This will win you listings and attract more buyers as you become their trusted Realtor. More listings and more buyers means a better bottom line!
