Differences in house prices on free valuation sites

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One house had a $780,000 price difference if the owners were to sell in this market.

SONY SIVANANDAN/123RF

One house had a $780,000 price difference if the owners were to sell in this market.

It’s a battle to get the best price when you sell your house.

Some property valuations are the same, while others are out, in some cases by millions of dollars.

On Wednesday, Trade Me launched a new tool that generates an estimate of the home’s current value.

Graeme Hart's house in Riddell Rd, Glendowie, Auckland is worth $2.23 million more on one site, than the other.

Graeme Hart’s house in Riddell Rd, Glendowie, Auckland is worth $2.23 million more on one site, than the other.

There are a few other sites out there that do the same, including Homes.co.nz, but just how reliable are they?

A check of random addresses in both search engines revealed a few discrepancies ranging from tens of thousands of dollars to millions of dollars.

Trade Me Property head of product Alistair Helm says it's important to remember that while the Trade Me Property ...

JONATHAN CAMERON/FAIRFAX NZ

Trade Me Property head of product Alistair Helm says it’s important to remember that while the Trade Me Property Estimate is a great starting point, it isn’t a professional valuation or appraisal.

Trade Me Property head of product Alistair Helm said Property Insights was a computer-generated estimate of “what we think a property is likely to sell for”.

“We’ve calculated this using our own algorithm that incorporates sales of similar properties (similar size, location and other features), RVs and Trade Me data.”

Property Insights’ point of difference was that it used a variety of unique data from Trade Me, including the listings on the site, user searches and interaction with those listings, Helm said.

“We think the Trade Me property estimate is a really useful starting point in figuring out the value a property is likely to reach when it’s sold.

“But there are certain properties and areas that we will have greater confidence in our estimate than others,” he said.

“That’s why we have a star rating for our estimates.”

The number of stars on a Trade Me property estimate represented the amount of data available he said.

The site gets updated monthly as new data rolls in from councils around the country, Helm said.

“This will help us further hone our estimates over time.

Homes.co.nz head of marketing Jeremy O’Hanlon said it used over 1000 unique valuation models to produce an estimate for more than 1.5 million homes.

Since launching in November last year, Homes.co.nz had been comparing its estimates against all sales results received from councils to make monthly improvements, he said.

“While we can’t say what’s under the hood of our models, we have all the council data and sales histories others in this space have access to.

“On top of this we recognise that every home is unique so enable homeowners to update 38 variables about their home – from LED lighting, to insulation and parking,” O’Hanlon said.

“Our accuracy has come a long way in 11 months. I’d expect other providers will gradually improve as they get started too. It’s a lot to get your head around.”

The next step for the site was to encourage homeowners to have their properties valued by a real estate agent or valuer associated with the company, he said.

Those valuations would be used to improve the accuracy of the site’s estimates.

The real estate agent would do the valuation for free but the valuer would charge for their services, O’Hanlon said.

Random house comparisons:

Homes.co.nz versus Trade Me Property Insights

Lake Tce, Taupo: $1.2 million v $420,000 (difference = $780,000)

Valley Rd, Mount Maunganui, Tauranga: $520,000 v $830,000 (difference = $310,000)

The Terrace, Wellington Central, Wellington: $780,000 v $940,000 (difference = $160,000)

Mount Eden Rd, Mount Eden, Auckland: $1.38m v $1.24m (difference = $140,000)

Fitzgerald Avenue, Christchurch Central, Christchurch: $600,000 v $480,000 (difference = $120,000)

And one extreme example – Graeme Hart’s house in Riddell Rd, Glendowie, Auckland: $37.07m v $34.84m (difference = $2.23m)

 – Stuff

Continue reading this article at the original source from Stuff.co.nz

 

 

 

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2017-04-07T15:44:04+00:00