How Accurate Is Your Zillow Zestimate? (And What It Could Be Costing You)
Quick Take: Homeowners often rely on Zillow’s Zestimate as if it’s gospel - but it’s frequently wrong. In 2025, depending on an algorithm to price your biggest asset can lead to overpricing, underpricing, or losing serious money. Learn what Zillow gets wrong, and what a real expert would do instead.
Table of Contents
- Zillow Isn’t Looking at Your Floors or Your Future
- The Algorithm Can’t Smell the Upgrades
- Zillow’s Margin of Error Is Bigger Than You Think
- Never Use a Zestimate For These Situations
- What to Do Instead: Trust Strategy, Not Software
- FAQs
- Talk to an Expert
Zillow Isn’t Looking at Your Floors or Your Future
Most homeowners open Zillow and see a number - then take it as gospel. But Zillow’s own data shows their Zestimates can be off by up to 20%. That means you could be pricing your home $50,000 too high… or leaving tens of thousands on the table.
Why? Because Zillow has never set foot inside your home. It doesn’t know about your new white oak floors, the Carrera marble counters, or the fact your neighbor listed 30% above market and pulled your number up with it.
The Algorithm Can’t Smell the Upgrades
A Zestimate is just an algorithm guessing based on square footage and publicly available data. It doesn’t know:
- Whether your home was remodeled last year or last century
- If the layout flows or feels awkward
- What buyers in your neighborhood actually want right now
- Whether nearby sales were teardowns or turnkeys
Think of it like asking ChatGPT to diagnose a skin rash it can’t see.
It might give you an answer - but would you bet your financial future on it?
Zillow’s Margin of Error Is Bigger Than You Think
Zillow reports its own average error rate is 7.49%. But that’s just the average.
In reality, we’ve seen Zestimates off by six figures in Los Angeles.
Overprice and you might miss the initial buyer window and have to chase the market down. Underprice, and you could give away your equity.
In either case, a wrong Zestimate can cost you more than any commission ever would.
Never Use a Zestimate For These Situations
If you need an accurate home value for:
- Divorce or legal settlements
- Estate planning or day-of-death valuation
- Refinancing or pulling equity
- Selling your home
…you need more than a guess from an algorithm.
This is where a human valuation matters. Someone who understands not just comps - but psychology, buyer behavior, and market timing.
What to Do Instead: Trust Strategy, Not Software
We don’t just “run comps.” We look at what your home could be worth with the right positioning.
Our method includes:
- Current competition and active buyer demand
- Future market shifts that impact value
- Upgrade recommendations that you don’t pay for until you sell
Appraisers have literally complimented our pre-listing valuations as more detailed than their own reports.
If you’re selling, it’s like preparing for court - you want the best possible case. And that case should be built on reality, not a Zestimate.
FAQs
How accurate is Zillow compared to an appraisal?
Zillow’s average error is 7.49%, while certified appraisals are often within 2–5% of true market value. But appraisals still miss future buyer sentiment - strategic agent pricing can often outperform both.
Why does my neighbor’s Zestimate impact mine?
Zillow lumps nearby homes together. If your neighbor lists too high or sells off-market, it can skew your value - regardless of condition or upgrades.
Can Zestimates be used for legal or financial purposes?
No. Courts, banks, and financial institutions will not accept a Zestimate as a reliable valuation source.
What’s a better way to find out my home’s worth?
A strategic market valuation by an expert who knows the local market, current buyer behavior, and how to unlock value based on your timeline and goals.
Why does Zillow work for some homes but not others?
In cookie-cutter neighborhoods with similar homes, the algorithm might get close. But in Los Angeles - where every home is unique - Zestimates often fail.
Do buyers look at Zestimates when making an offer?
Yes, but educated buyers rely on agent insight and actual comps. Smart sellers control the narrative by pricing right - not by defending a Zestimate.
Want a valuation that actually reflects your home’s worth?
Book a 20-minute strategy call . We'll look at your home through the eyes of a buyer, outline how to unlock hidden value, and give you a real plan based on your timing and goals.