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An online valuation estimator will provide you with an approximate value of your home as you answer a few simple property-related questions. You can get the free online estimate in minutes.
HomeLight’s home value estimator requests basic property information and uses an algorithm that analyzes millions of transactions to predict your home’s worth.
Let’s look at that real-life example again using HomeLight’s Home Value Estimator:
Compared to the values determined by the three apps, HomeLight provides an instant estimate of $370,000 and then follows up by emailing you with a more specific estimate of $369,946.
The downside of using an online home value estimator
While online home value estimators can offer a quick snapshot of what a home might be worth, they often miss key details that can significantly impact an accurate price. Take note of these drawbacks when using online estimators:
Online valuations aren’t designed to replace an appraisal. An online valuation of your home can be inaccurate. HomeLight estimates the values the tools provide are within 7% of the home’s actual value half of the time.
Online valuations don’t have the human factor. The thing about online valuations is that no human has come out to assess your home. A real estate agent or appraiser will know the neighborhood and local market conditions, as well as what buyers love in a home like yours.
“An online valuation is just an algorithm. It’s very basic and may be ZIP code-driven — it might not even be community-specific. A computer doesn’t take into account the extra analyses performed by an agent or appraiser,” LoCicero says.
“For example, does the house back up to a school or power lines? Is it in an area where car headlights are constantly shining in your living room? Maybe it has a community pool. Those kinds of things that add or detract value from your home,” he adds.
An algorithm also doesn’t factor in upgrades to your home that an agent or appraiser considers in their valuation. For example, you may have bolstered the value of your home by replacing your roof or modernizing your kitchen by installing stainless steel appliances.
