Northwood Realty Services announced Wednesday it will immediately pull all of its real estate listings from Zillow, one of the nation’s top real estate websites, due to what it called inaccurate and outdated information used to calculate home values in Western Pennsylvania.
“This decision is prompted by the inaccuracy of data on the site,” said Tom Hosack, CEO and president of McCandless-based Northwood Realty.
Zillow — unlike rival real estate sites Trulia or Realtor.com — pulls data directly from taxing authorities to formulate values.
Other real estate companies in the area, such as Howard Hanna Real Estate Services and Re/Max, are not following suit. They plan to continue to post listings on Zillow, where they believe the greatest number of home shoppers are likely to see the offerings.
Northwood believes that Zillow’s methods, which aren’t unique to this region, don’t work for Pittsburgh’s quirks.
“If the tax assessor doesn’t include improvements to a house such as an extra bedroom, the homeowner is happy to keep their tax bill low,” Mr. Hosack said. “But when the house goes up for sale, it could be listed as a three-bedroom, instead of a four-bedroom, with an inaccurate value and it’s very difficult to get it modified.”
It’s not uncommon for a Pittsburgh neighborhood that is 20 or 30 years old to become neighbors with a new development, causing Zillow values in the old development to go up or values in the new one to drop. Also, Zillow values do not consider that homes across the Butler County line can be worth more because the real estate taxes there are lower.
After reviewing various websites for consumers trying to find out the value of their homes, Northwood determined Zillow’s “Zestimate” can be misleading because the margin of error is so great in the Pittsburgh market.
Zillow says on its website that its Zestimate in the greater Pittsburgh region is within 20 percent of the accurate sales price 81 percent of the time. By comparison, in Cleveland, the Zestimate is within 20 percent of the accurate sales price 87 percent of the time.
“That’s not very accurate at all,” Mr. Hosack said of Pittsburgh’s rate. “We have been receiving complaints from sellers about what’s on Zillow’s website for some time. We tried to bear with it, due to the prominence of the website. But in the end, we have to take care of our sellers and the accuracy of their information.”
Zillow representatives said an important thing to consider about the Zestimate, which is an average price, is that its accuracy depends on location and availability of data. Some counties have deeply detailed information on homes — such as number of bedrooms, bathrooms and square footage — while others do not.
Zestimate values for half of the homes in Pittsburgh are within 7 percent of the selling price and half are off by more than 7 percent, according to Zillow.
“The real losers here are the homeowners who have retained Northwood agents to sell their homes,” said Katie Curnutte, Zillow senior director of communications. “By pulling for-sale listings off the most popular real estate site and set of mobile apps in Pittsburgh, the brokerage is severely limiting the audience of potential buyers who are seeing these listings. It’s a real disservice to their clients.”
O’Hara-based Howard Hanna Real Estate Services is a big believer in Zillow, its president and CEO, Howard “Hoddy” Hanna III, said.
Real estate agents are not required to pay to list their homes on Zillow. Northwood Realty does not pay for listings.
Howard Hanna pays for an exclusive agreement with Zillow where all of its listings are highlighted in green and companies cannot sell ads on pages where Howard Hanna listings appear.
“Clearly Zillow is not 100 percent accurate,” Mr. Hanna said. “But they are consistent in their opinions of value, which is more than I can say about a lot of municipalities. The only thing that is 100 percent accurate is what a buyer and a seller are willing to agree on.
“We are on Zillow because a lot of people go there to look at inventory and products and get some idea of their own home values.”
According to comScore, a Reston, Va.-based company that monitors traffic in the digital world, Zillow is the No. 1 most visited real estate platform in Pittsburgh.
Brian Teyssier, a real estate agent with Re/Max Advanced Realtors in Robinson and Sewickley, said the move by Northwood Realty could have a negative impact on sellers trying to make sure their home is viewed by potential buyers.
“If I’m a seller and I’m listing my home for sale, I’m severely impacting my chance of being discovered by potential buyers by not being listed on the most popular real estate website out there,” Mr. Teyssier said.
Mr. Hosack said when Zillow announced in July that it was buying Trulia for $3.5 billion, he decided to see if it would change its valuation methods. But no changes appear to be in the plans.
Northwood will continue to provide listing information to Realtor.com and Trulia, Mr. Hosack said, because the accuracy of those sites is more consistent since they do not pull data directly from taxing authorities to determine values.
He said if a seller listing a home with Northwood requests that it appears on Zillow — even with the knowledge that information could be inaccurate — Northwood will manually add it to the website.
“It’s a disservice to our sellers whenever buyers see the wrong information about the house online,” Mr. Hosack said. “We have been in touch with Zillow several times today and we assured them that if they could come up with a way to improve the accuracy of their data, we would put our listings back on the site.”
First Published: September 11, 2014, 4:00 a.m.
