In Response to Study, The Grubb Co. Realtors Speaks of Locality's Importance

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The Grubb Co. Realtors illustrates why knowledge of the local area always beats a national study that may not take local factors into account.

Home search websites such as Zillow and Redfin interpret MLS data differently. Zillow is an online portal whose customers are real estate agents. Redfin is a national real estate brokerage whose customers tend to be buyers and sellers. Another key differentiator between the two is whether they include list prices when calculating automated home valuations; Redfin does. Zillow’s ‘Zestimates’ don’t. The Grubb Co. Relators look at these results, and why they matter.

Computers have made their way into every aspect of people’s lives, in all shapes and forms. Need directions? Want to listen to music? Curious about whatever happened to so-and-so? Just fire up the computer or ask a smartphone. While this computing power, now taken for granted, is indeed amazing, it’s also limited. A computer can very quickly examine hundreds of thousands of possible outcomes before deciding how to move a particular chess piece, but only the ones its programmers have taught it to consider.

A recent study – commissioned by Redfin, but conducted by independent firm SSRS – found that Redfin’s automated valuations for property listings are considerably more accurate than online estimates from competitor Zillow. Looking at properties across the U.S., the study found that half of Redfin’s advance estimates for recently sold listings were within 2.06 percent of their sales price, compared to 5.95 percent of Zillow’s. The study did not compare initial estimates for properties before they were listed.

Zillow argues that by “baking” list prices into their calculations, Redfin is simply prognosticating. Redfin replies that their data is better “because there are more data points and more-up-to-date information available about those homes than there are for homes that haven’t been on the market for a while.”

The Grubb Co. Realtors decided to see how the dispute mapped to a local case study, using 438 West Grand, #724, in Oakland. They found that the value assigned to this home by Redfin was $697,814 ($757/sq. ft.) and the Zestimate was $607,437 ($659/sq. ft.). This 15 percent disparity seems rather unhelpful.

So how can one get a more accurate take on what a particular home is worth? As The Grubb Co. Realtors have said many times, real estate in the East Bay Area is local. Having a local expert in camp is always going to trump a national website whose data set doesn’t include longtime familiarity with the homes and neighborhoods, and whose mission is to satisfy investors rather than homeowners.

“We make sure grubbco.com’s listings provide all of the information home buyers and sellers need, and ensure the quality of those listings with institutional knowledge built over 50 years of local, boutique real estate service,” says Grubb Co. President D. J. Grubb.

For more information about The Grubb Company, please visit http://www.grubbco.com.

About the company:
The Grubb Company is a full-service real estate firm, offering their clients a smooth and professional real estate experience. With 50 years in the business, The Grubb Company knows that a high level of service ensures the satisfaction of their clients. They have a foundation of discipline, accountability, and teamwork that sets them apart from other real estate firms in the area. The Grubb Company is committed to providing their clients with the best agents, the best service and the best houses around. To learn more, visit their website at http://www.grubbco.com/.

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Susan Kline