Zillow just dropped the Beta tag from their name. When it was released last year, I posted this and this. What we found was Zillow didn’t like bedrooms. Turning a 4 bedroom house into a 1 bedroom house added $60,000 in the Zestimate.
Using our four bedroom, two bath single family rental property in Southeast, Zillow estimates the homes worth at $413,500 within a range of $343,500 – $480,000. The tax record is accurate. The range is huge; close to worthless but probably reflects a major fixer to a fully remodeled house. I’d probably consider $413k if I got an offer for it.
What happens when we tweak the home’s stats:
Lose a bedroom (3 bed, 2 bath): plus $525
Lose 2 bathrooms (2 bed, 2 bath): minus $1815
Add a bath (4 bed, 3 bath): plus $11,168
Now here’s the one I don’t get: lose a bedroom, add a bath (3 bed, 3 bath): +$55,634
The upper range of the house has now gone up to $516,000.
I didn’t mess with the stated square footage until now: add 1000SQFT and value to the base house goes up $141,000. With the added square footage, there is less difference between changing the bed bath configuration. The highest value becomes 4 bed, 3 bath, +1000SQFT which adds $155,100 in value.
Overall, I give more credence to the “truth” than the hypothetical. I think their first shot at value isn’t bad. Some of the changes seem a little out of whack- there must be a premium for larger bedrooms or as a ratio to square footage. Three bed, three bath seems like a strange combo to place a premium on.