Beware of free online property valuations

[Selling Guide]

I’ve received no less than 2 Press Releases today - from property websites that offer to provide free estimated valuations of residential property.The result of checking these? That they both have a long way to go.Zoopla.co.ukAside from the poor name, the search interface is relatively free and easy to use.The problem is twofold - all [...]

More: Beware of free online property valuations

[mouseprice.com]

Hi,

First of all - thanks for checking out the new site at mouseprice.net. We're really pleased with how it behaves and looks so far - and we love the Microsoft Virtual Earth platform and the Birds Eye views. It's still only in beta though - so there's more to come!

I understand your scepticism, but I have to correct your judgement about our valuations. Whilst we provide previous transaction information where available - we do not merely index the price forwards to create a valuation as you imply. I can't speak for anyone else, but Mouseprice's valuations contain a great deal more data than merely previous price information (which is only available in a minority of cases anyway). We don't make use of any "generic guesses" - our valuations are derived from various data sets we hold on a wide cross section of properties in England and Wales.
Thanks again though for your review, and your feedback - we're trying to build a great site, and hope that you continue to use it and review it as we add more functionality and scope.

Cheers,

The Mouseprice.com team.

[brian]

Thanks for the comments - I've got to admit, I'm still sceptical that you can apply a generic formula to specific property values - but as the site is in beta, it's yet to really show its real merits in this regard.

It's possible the Zoopla use clouded judgement on Mouseprice.net - Zoopla's figures were awful, and could only have been primarily derived from use of generic regional data. I could easily see this on my own property valuation, which was very different to actual prices on same properties in my immediate area - perhaps not least because local market conditions have been very different to the overall regional change.

The maps feature was nice - but far far too inaccurate at present. Have you tried to find your own property with it?

By the way, we had a spam post yesterday promoting your site - user now banned, and I'd advise you tell your PR/Marketing team to avoid spamming forums if you value your reputation.

[mouseprice.com]

Hi Brian,

Apologies for the over- enthusiastic post - it wasn't by the PR team, but I think may have been someone's Mum!!

In terms of the valuations, Mouseprice's valuations are powered by our parent company, Calnea Analytics, whose core business is the sale of similar valuations to Mortgage Lenders for use in mortgage and re-mortgage cases. These are derived by their Automated Valuation Model.

In terms of the pin - I completely agree with what you say. On my own property, the pin is exactly over my flat - but I live in quite an urban area. In some areas - the pin may be located over the centre of a postcode which may be a little distance from the property. We know how this can be corrected - but doing so would cost us a lot of money - so we're negotiating - we'll let you know how we get on! In the meantime, we're planning to explain a bit more clearly the rationale behind the location of the pin.

Thanks again for your comments though - it's great to get feedback - especially when its of the informed variety!

Cheers,

Zipporah.

[natalie]

We have had our house on the market for 2 months,we based our asking price on 3 seperate estate agents estimates of £90-92000.Also for a few months before we put our house on the market we always consulted Zoopla for estimates,they valued our house at £90-95000,it was valued at this price for a few months,never really changing.So going by all these estimates we have our house on the market for £92000.
We check Zoopla weekly,but the last time we checked,our house was valued at £85000,it had gone down to that in a matter of one week.WHERE DO THEY GET THEIR FIGURES FROM?Also Zoopla says our property has rental potential of £260-340 a month.This is all incorrect,we know for a fact we could get £400-500 a month,estate agents have stated so,plus our neighbours are renting their homes for anywhere between these two figures in our street alone.

I trusted Zooplas quotes and estimates,but now,i have no faith in them.If they checked local house prices correctly and not just the last sale prices etc,they know nothing of the state or condition of properties,we have had work to the tune of £37000 done to our property,double glazed,new roof,new electric,damp-proofed,you name it.

ZOOPLAS FIGURES ARE NOT THE GOSPEL AND PEOPLE SHOULD NOT TAKE THEM AS SUCH.Zoopla has devalued our house,so anyone interested in our house who looks on their site will think we are over asking,but we are not.

[drhouse]

Originally Posted by natalie

We have had our house on the market for 2 months,we based our asking price on 3 seperate estate agents estimates of £90-92000.Also for a few months before we put our house on the market we always consulted Zoopla for estimates,they valued our house at £90-95000,it was valued at this price for a few months,never really changing.So going by all these estimates we have our house on the market for £92000.
We check Zoopla weekly,but the last time we checked,our house was valued at £85000,it had gone down to that in a matter of one week.WHERE DO THEY GET THEIR FIGURES FROM?Also Zoopla says our property has rental potential of £260-340 a month.This is all incorrect,we know for a fact we could get £400-500 a month,estate agents have stated so,plus our neighbours are renting their homes for anywhere between these two figures in our street alone.

I trusted Zooplas quotes and estimates,but now,i have no faith in them.If they checked local house prices correctly and not just the last sale prices etc,they know nothing of the state or condition of properties,we have had work to the tune of £37000 done to our property,double glazed,new roof,new electric,damp-proofed,you name it.

ZOOPLAS FIGURES ARE NOT THE GOSPEL AND PEOPLE SHOULD NOT TAKE THEM AS SUCH.Zoopla has devalued our house,so anyone interested in our house who looks on their site will think we are over asking,but we are not.

You believed Zoopla when they were in line with your figures and they were very much in line with the estate agents you had out but you don't believe them now when they are lower. Zoopla are not totally accurate - they are a guide. They get their prices from local sales - as do estate agents. However an estate agent can take into consideration if some properties achieved low prices because they were in poor condition, bad location or repossessions which Zoopla cannot. A few properties sold at knockdown prices can very quickly bring the average down.

I don't know if Zoopla get data from the Land Registry. They usually release figures once a month which would explain the drop in a week.

[poleinthesticks]

I have no idea how zoopla gets their algorithms, but for two houses I specifically looked at, their estimates were massively - and I mean by more than 20% out of the way. One house which has a HIP valuation (we are in Scotland, so the HIP provides a survey and a valuation for mortgage purposes as well as estimated rental income) of 185k, comes on zoopla as over 250k!!!! Another, valued on the survey at 210k (and on sale for oo 199k) comes up on zoopla as 145k.

MY own judgement is that neither estimate is correct, the survey valuations seem closer to the real value, if perhaps a tad optimistic in the case of the second house. I "adjusted" estimates by entering a lot of data for each property, including floor areas, extra features ect - and not much changes, the first one still stays in its ridiculously overvalued state, while the second one doesn't even start to get near to the 200k, never mind 210k.

Obviously I would love to show the Zoopla estimates to the vendor and say "we offer you 10k above that, but still 30k under the asking price" and have it accepted, but I somehow doubt it.....

Any thoughts?

For additional info, the first house was sold for 185k in 2004, and the second was sold for around 140k in 2003, so I suspect it's all based on the actual last sale price and the trend for the large postcode area.

[mortgage_advisor]

I just checked my house on mouseprice and it was pretty acurate. Only bought it 6 months ago, but paid a good price for it and the estimated value is above what we paid, as I would expect it to be.

My issues with these sites is quite simply, what is the point of them? They are nothing more than a guide, and it can be a bit of fun to look up your own ar other houses, but the figure is meaningless, won't effect what you would consider selling for, won't be any use as a bargaining tool, and won't effect what an agent would suggest as an appropriate price or affect the price obtained.