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Why Zillow Is More than a Home Value Estimator

Zillow spokespeople want their company to be thought of as a media company, not an online real estate service. They talk about new products as a television network touts its top programs. In keeping with the media metaphor, here is Zillow's summer lineup of hit shows:

Zestimate Values: Zillow's signature offering doesn't come cheap. The company must buy information about houses from third-party data providers who already collect this material and sell it. Typically, when a house sells, it takes about three weeks for the information to become part of the public record. Tens of thousands of homes sell each month, and Zillow uses a computer program to track and then integrate these prices into its expanding database of home prices.

Zindex: Zillow's home value index is an aggregate of the estimates it lists on those 72 million homes. Nationwide, Zillow's median margin of error is 7.2 percent. Because 50 percent of its errors are high and 50 percent are low, the Zindex is not only remarkably accurate, but also a telling measure of the economic health of particular areas of the country.

My Estimator: Here you can list the improvements and upgrades you've made to your home and instantly see the impact of those changes on the value of your home. Owners can select comparable homes to improve the estimated value, then publish these so potential buyers can see how the selling price was determined.

Claim Your Home: When you register as the owner of a property, you can add upgrades, photos and narratives. If members of the growing Zillow community have questions about your home, they might well contact you. Zillow also sends you regular e-mails showing changes to your home's value. Barton says 800,000 people have so far "claimed" their homes and that visitors to the site are uploading between 8,000 and 10,000 photographs a day. (And you think homeowners aren't territorial about their shelter?)

Comps: See which homes that have sold recently are most like the home that interests you. Compare, sort and contrast these comparable homes and prices to get a better overall picture of the market.

Home Q&A: Here anyone can ask any question they choose, from price negotiations to worries about the neighborhood. CEO Rich Barton recalls one instance in which someone looking at a home in Tacoma asked, "I've heard Bing Crosby grew up in this house. Is that true?" And the answer came back, "Well, yes. Der Bingle lived there as a young boy, before his family moved to Spokane." In another instance, someone looking at a home via Zillow's satellite photographs noticed that the backyard seemed close to a nearby freeway and wanted to know, "Is it noisy? Will it bother me?" And the owner was able to explain that a row of trees seemed to dampen the highway's din.

My Neighborhoods: Same idea, only about entire neighborhoods, not just specific homes.

Make Me Move: This one's simple: You set the price - any price - on your home. You provide pictures and other information. If someone likes your place and can afford your dream price, they contact you. To date, about 81,000 homes have been listed, and about 10 percent of these owners have been contacted.

Post for Sale: You or your agent can "list" your home on Zillow gratis. You may add unlimited photos and descriptions and edit these whenever you like. Zillow takes no commission.

Zillow Real Estate Guide: A place to interact with others to learn what you need to know about selling your home from the Zillow online community, or for you to share what you've learned with others. The real estate guide is Zillow's wiki about the world of real estate, where everyone's invited to contribute and edit.

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© Washington CEO Magazine 2008