Illinois Woman is Suing Zillow for Inaccurate Zestimate

 Posted on May 30,2017 in DuPage County Real Estate Attorney

Zillow is facing a potential lawsuit for its infamous "zestimate" tool. Filed by an Illinois woman, the suit alleges that the company has undervalued her home and made it difficult to sell. She is also claiming that the company is wrongfully providing appraisals, which should be considered a violation of the law. The case is already picking up steam, gaining recognition and support across the country, and that could mean drastic changes for real estate buyers, sellers, and investors.

Details of the Case

In her suit, the Illinois woman alleges that she has been trying to sell her townhome for some time now, but with no success, despite its prime location. She claims that her roadblocks are a direct result of Zillow's inaccurate zestimate, which has allegedly valued her home using the sales of newly constructed homes in a less expensive part of the city. She is seeking an injunction and wishes for the company to either fix its inaccurate valuation or remove it entirely.

Zillow Defends Their Zestimate

Zillow claims they have done nothing wrong. Their zestimates are purportedly within 5 percent of the sale price of the homes they list a little more than 50 percent of the time, within 10 percent about 75 percent of the time, and within 20 percent almost 90 percent of the time. Further, their website explicitly states that they are not an appraisal service. That does not mean that visitors do not use their site for that purpose, however, and that could mean trouble since their accuracy rates leave much to be desired.

As an example, if Zillow were to fall within 20 percent of the purchase price on a $500,000 home, they have $100,000 of wiggle room. That amount is certainly enough to leave buyer's thinking a home is overpriced, and it could potentially cause a homeowner to drop their price far below market value, which could result in a significant financial loss. On the other hand, this could drive up the price of a less than desirable property, potentially leaving buyers surprised when they pursue an appraisal of the home.

Why the Lawsuit Matters

News sources indicate that the Illinois woman has already been approached by other homeowners and realtors who want to turn the case into a class action suit. Such action could ultimately change the way that homeowners, buyers, and investors search for real estate. At the very least, it may bring attention to an issue that has been of great concern for quite some time.

Whatever happens in this case, it is important for all real estate buyers, sellers, and investors to know the importance of accurate valuations and due diligence. The experienced DuPage County real estate lawyers at Stock, Carlson & Asso. LLC can help. Committed to your future and best interests, we can help you navigate the home buying, selling, or investing process. Schedule your consultation by calling 630-665-2500 today.

Source:

http://www.miamiherald.com/news/business/real-estate-news/article149337129.html