In today’s Miami Beach seller tips, we talk about using online home valuations. There are so many real estate sites that constantly advertise to home sellers and buyers. Since many of these sites have spent millions of dollars branding themselves on TV ads and online, consumers tend to take their advice and what they find on their sites as real and correct information. Unfortunately a lot of the data you find on these sites is not really that accurate. The reason it’s not accurate is that real estate is local, and it’s hard to these huge conglomerates to get super hyperlocal which is what you need to do when pricing real estate for sale.
Miami Beach real estate seller tips:
Jamey & Ognjen talk more about using online estimates for home valuations.
I wrote about this before and here is an example from a previous blog post.
Let me show you a good example.
In South of Fifth over the past six months of closed data, if I pull the average closed sales of a two bedroom units it is: $840,371
If I keep the data the same and just add in “waterfront” as criteria, the average is: $1,017,582
Still the same data but now building specific: $2,515,000
Look at the difference from the starting point. It’s huge!
If you are a seller you could be leaving a lot of money on the table, and if you are a buyer you may be really undereducated about the market. Now, I have seen the sites both higher and lower on pricing, so it goes both ways.
I just researched the accuracy level of one of the most popular sites for Miami and their accuracy level for Miami rated as two out of four stars. The website stated an 8.7% median accuracy and just above “not able to compute”. Now, on a lower price point 8.7% may not be a big deal. On our typical transaction starting from $1 million, that’s $87,000. That’s a huge difference and a lot of money.
In addition, the average list to sales price is usually less than 5% on average. So 8.7% is a crazy number to be off.
The takeaway
Using those big online websites is a good starting point (if you must), but I wouldn’t recommend making huge real estate decisions based on these models. Seek a more local approach, so the data is relevant and to make sure you aren’t leaving money on the table.
Miami Beach real estate seller tips when pricing a property:
1. Use the big online sites as a starting point but not the final say.
2. Start super local for instance within your building and then build out a comparable market analysis from that starting point.
3. Always get advice from a trusted, experienced local real estate agent.
4. Read the fine print. You will probably find after a little digging that these big online sites have a lot of disclosures that display their accuracy ratings.
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