Zillow VP/CFO Runs Smack Into the “Unzillowables”

September 25, 2006 |

Stinky
This post recently came across my RSS reader.  It is from the Zillow Blog, and written by Zillow’s VP of Marketing and Chief Financial Officer, Spencer Rascoff.  The post tells us of Rascoff’s journey through 3 open houses in his area, all of which were homes found on Zillow.  He doesn’t give us the data for the first two homes, other than to say that, "the Zesitmates were very close to the asking prices."  He, instead, focuses on the story of the third house.  It is at this home that he runs smack into some "unzillowables"  According to Rascoff:

As soon as I walked in, I was taken aback by the stench. There was
no furniture, the carpets were stained and the house reeked. I quickly
figured out why this house was asking $710,000 when most houses in the neighborhood sell for $1M+.

Anyway, the Realtor noticed me grimacing and then filled me in.
Apparently the homeowner is an elderly man who several months ago moved
into a nursing home. When the owner’s family hired this agent to sell
the house, the agent discovered a squatter had apparently broken into
the house and had been living there for several months. I should add
that my house is right around the corner and shares a fence with this
house. Also, several months ago my wife told me she saw a man hop the
fence and go into their backyard. I told her she was crazy and ignored
the event. (When will I learn?!) Anyway, the man — the squatter –
bolted when the agent entered the house that day. Several months and
many cans of aerosol later, the house is now on the market.

Talk about unzillowables!  I’m pretty sure that the subject property’s Zestimate doesn’t mention any squatters.  After viewing the home in person, Rascoff draws the following conclusion:

I will say this for the house: for someone with a limited sense of
smell and an appetite for a big-time remodel, it’s a bargain at $700K.
The house next door (which is in great condition) just sold for $1.4M, so I think this one could be fixed up for less than the $700K difference.

Out of sheer interest, I clicked on the "map comparable homes" link for the smelly subject property in question.  Check out what I found.  The homes that are comparable to the subject property, according to Zillow, are valued between $499K and $825K, with the average being around $690K.  It would seem to me that the subject property isn’t such a deal at $710K.  Why isn’t it such a deal?  Because of the unzillowables!  $710K seems fair when set against the comparable properties, but did those comparable properties also have issues with their overall condition, not to mention lack of security?  The Zestimate for the subject property is $720,432.  According to what Zillow’s own visual inspection of the property yielded, the sales price probably won’t be anywhere near that figure.  That, my friends, is a quintessential example of the role that unzillowables play.  Although, the owner is now free to log into Zillow and add the fact that the house has been shelter for a squatter for months.  I wonder how that will affect the Zestimate?

And as far as Rascoff’s opinion that the home is a deal because of the sales price on the house next door, that house has over two times the square footage, 2 more bedrooms, and 1.75 more baths than the subject property.  On top of that, Rascoff tells us that the house next door is in great condition, which obviously cannot be said for the subject property.  I’m sure those aren’t the only differences in the properties. 

I don’t want to sound like I am picking on Rascoff just for the sake of being facetious.  I am not.  I bring this up because the devil is in the unzillowables.  I find it ironic that this time, the unzillowables are right in front of Zillow’s face, or nose, as the case may be. 

 

Posted by Daniel | Filed Under Blogging, Industry Issues, disintermediation 

Comments

2 Responses to “Zillow VP/CFO Runs Smack Into the “Unzillowables””

  1. jf on September 25th, 2006 2:38 pm

    Seeing, and smelling, is believing. A devil of a good post.

    ps: Love the pic

    [Reply]

  2. Broker Price Opinion on December 24th, 2007 6:00 pm

    Zillow is still just a tool for sellers in the beginning of the sales process eventually most sellers will hire a pro.

    [Reply]

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