Want to know what a home is worth? You might want to skip Zillow

Today's consumers are savvy, and that is true for those looking to wade into the real estate market. Many are very well educated about what they'll be dealing with before they begin their journey in buying or selling a home. Access to information online is very much a part of that. 

One popular website, Zillow, has become an integral part of the dialogue when people are talking real estate, and with 73 million unique visitors in 2014 alone, that shouldn't come as a surprise. Being able to find active listings and information on homes that are not in the market is easy: you simply plug in the address or location and crucial information like the number of bedrooms and bathrooms, property taxes amounts — not to mention photographs and a "Zestimate" pop up.

(A Zestimate, according to Zillow.com, is Zillow's "estimated market value, computed using a proprietary formula".)

That said, it's not uncommon for me to hear (and I know that my colleagues can attest to this) folks refer to the Zestimate when talking price on a property, no matter if they are looking to purchase or sell. 

It is often distressing.

Flickr photo by Delwin Steven Campbell

Why?

Because Zestimates are not accurate.

And in an article in the LA Times, Zillow CEO Spencer Rascoff noted that nationally, Zestimates have a "median error rate" of roughly 8%.

8%? Think that doesn't seem like a lot? Consider this: on a $300,000 home, that's a $24,000 discrepancy. And that's not even considering the localized median error rates. It seems that those surpass the national median.

Some agents have done their own research into how far off the mark that Zestimates are in the local market. In markets in Virginia and California, some Zestimates were overestimated while others were well below the selling price — the latter 70% of the time. Another 25% of the Zestimate were higher than the contract price. 

According to Zillow.com, the median error rate for Michigan is 8.1%, and 6.1% for Washtenaw County, 7% for Livingston and an even higher 10.5% for Wayne County.

It's pretty easy to see how buyers and sellers might not see eye to eye when it comes to pricing. Since real estate by it's very nature is local, no matter where you live (or are looking to move) your best bet is to connect with a Realtor who can give you an accurate snapshot with regard to the information on your property or those that you're interested in. 

Chris Glahn is a licensed Realtor in the state of Michigan with RE/MAX Platinum Ann Arbor. He can be reached at 734-730-3403. 

Dexter considering Broad Street site for new apartments, condos

 Dexter is an inviting place to live, and with the completion of the trail connecting Mill Creek Park to Hudson Mills, even more so.

With an eye toward housing development in the downtown area, the city applied for a target market analysis grant, which will flesh out an idea of what potential is there for housing development. 

One area, overlooking Mill Creek on Broad Street, seems ripe for development and was the topic of discussion at a meeting in January. Representatives from Ann Arbor-based Peter Allen & Associates made their case for developing the site into a 128-unit apartment complex, by way of a report that's part of the Redevelopment Ready Community program offered by the Michigan Economic Development Corp.  

The city purchased the land for $1.3 million in 2012. 

The proposed housing site is just a short walk from Mill Creek Park.

Formerly an industrial site, the land would need some attention, including areas that have been left contaminated — which has an estimated cost of $1.2 million to clean-up — according to Tom Wackerman, president of ASTI, an environmental cleanup firm. Grants from the MEDC may cover that cost. He added that for now, concrete slabs have been placed over areas considered hotspots in an effort to keep any contaminants contained.

With at least another $800,000 to push back the road on Broad Street and getting the utilities in order for the proposed site, the city would also need to improve public transportation, according to Allen's proposal. The city has applied for a grant through the RRC to help with the former.  

The proposed 3-4 story L-shaped buildings are aimed toward millennials, a demographic that Allen says that Dexter is not drawing in. 

"You have an extraordinary village-city, that is ready for the next leap up,” Allen said. 

“But you’re missing something that we are trying to address tonight. You’re missing that demographic of the 20 to 30-year-old.”

The proximity to Ann Arbor would be one asset. 

Those folks who are older and looking to downsize could very well be another comparable demographic, as Dexter Mayor Shawn Keough noted during the meeting. 

"I think they are one and the same,” he said. 

“I think there are some commonalities.”

This idea is not beng pursued solely as a leasing enterprise. After two years, the complex could have a life as condominiums — perhaps marketed toward the existing residents, empty-nesters or those simply interested in downsizing.

It's estimated that a developer would need to invest another $20 million to construct the apartments, and Keough notes that the Allen & Associates' proposal is just the beginning of much to be considered when thinking of the city's future when it comes to housing. 

Moving forward, the city needs to examine the report and take it under advisement as the City Council and the Downtown Development Authority look at the possibilities. 

Click here for more on the Heritage.com. 


Chris Glahn is a licensed Realtor in the state of Michigan with RE/MAX Platinum Ann Arbor. He can be reached at 734-730-3403.