Problems and Inaccuracies with Online Home Valuations on Long Beach Island
Online Home Valuations in the LBI Real Estate MarketLong Beach Island Real Estate
The Internet has had a profound and lasting impact in the world real estate. Both home buyers and home sellers in the LBI real estate market can take advantage of numerous tools available. It is important to remember that there are limitations to the efficacy of automated real estate websites. Nowhere are these weaknesses more prevalent than in online home valuations in the LBI real estate market.
Online Home Valuations in the LBI Real Estate Market
An online home valuation is often touted as being a great way to easily find out what your home may be worth in a real estate market. The most common and well-known of these online home valuations is Zillow’s “Zestimate”. While Zestimates and other similar valuation tools may come close to the value of a home in a tract development, there are several reasons online home valuations in the LBI real estate market are largely ineffective.
- Online valuation tools for seller’s do not properly take into account the location of a home
- Online valuation tools often failed to give proper credit to the condition of a home
- These tools will give no credit or deduction for extra expenses such as flood insurance and the added cost if a home is below base flood elevation.
Most online home valuation tools will base their determination on information provided by local tax records. This information will include generic metrics such as lot size, square footage, and the year a home was built. On Long Beach Island, this information is essentially useless when one fails to take into account the more abstract valuation tools, namely location. Online valuation tools cannot distinguish between a home located on the ocean block at a home located on the Bayside and therefore cannot provide the proper valuation for this criteria. Furthermore, a valuation tool cannot distinguish the value of a water view. It is very possible to have a 2,000 sq. foot Cape Cod built in 1950 three houses off the beach and a 2,000 sq. foot new construction home in the exact same location see a nearly identical valuation even though the new construction will have more modern amenities and a far better. In furtherance of this scenario, we often see a new construction located third off the beach and a new construction mid block on the Bayside see a nearly identical valuation even though in reality, there could be as much is a 20% to 30% difference in the true market value of these homes. The only way to properly determine the true market value of the whole is to examine its unique characteristics and compare them to other recent sales. Utilizing generic tax record information simply does not paint an accurate picture of the true value of a home.
Selling in the Long Beach Island Real Estate Market
Selling a home in the Long Beach Island real estate market involves several crucial steps, the most important of which is price. Regardless of the amount of staging or marketing, if a home is overpriced it simply will not sell. Automated online valuations can be a dangerous tool as it can often paint an accurate picture of the value of a home. While there may come the day (and I believe that day will come) where online valuations improve, for now it is important to evaluate the property with comparable sold homes as well as the current active inventory to truly determine the net value. For more information about online home valuations in the LBI real estate market were for information about selling your home, contact and I will be happy to answer any questions you have.
By : Nathan Colmer | The Van Dyk Group
Cell: 609-290-4293 | Office: 800-222-0131 | ncolmer@vandykgroup.com
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