Athol, I'm glad you said this:

"Just pull what comps you want until it comes out what you want it to." Because the Internet is making it easier and easier for anyone to pull comps. I'm no expert, and I'm certainly no realtor, but it was easy as pie for me to pull comps myself from a Denver neighborhood or Denver zip code (here if you want to look http://www.cohomefinder.com/browse-ci-Denver-zip-... and start drawing conclusions about values.

Joel - welcome, thanks for commenting! Interesting eval tool. I don't know the laws in Colorado, but if you were here, having the word "appraisal" in it could wind up getting you in a little trouble. Probably worth confirming it's OK in CO.

Athol - as always, your commentary is spot on!

Well lets be honest about CMA's here too. I often say a CMA stands for Could Mean Anything. It's all on the comps you pull. Honestly any agent with half a brain can make a CMA turn out +/- 15% on whatever fair market value is. Just pull what comps you want until it comes out what you want it to.

For me the real CMA number is just a gut feeling after I do the math and see the house. It's about knowing the market and having a educated... well... guess.

Long time lurker, first time poster...

This is a great thread. In our Colorado Market, we've struggled with the wildly random "zestimates". Often, they're surprisingly accurate, but when they're off, they can be off by as much as 15%. To further complicate things, it's hard to identify without a good bit of diligence whether they're 10% high or 10% low, and the instant home evaluation almost seems to create more work than just doing an old-fashioned CMA.

Although we belive in Automation, it needs to be flexible enough to adapt to necessary changes and with Zillow -- so much of their algorithm is "behind the curtain" that it's hard to identify what changes need to be made. For this reason, we developed an evaluation tool to help our agents brainstorm interactively with clients about the value of their home.

If you'd like to check it out, feel free. With a few exceptions, we feel that its principles can be applied in any market:
http://www.automatedhomefinder.com/appraisal

No problem Jay. If you have any questions, please don't hesitate to let me know. I also did a blog post on our Wallhogs blog which may help to explain a bit more-

http://www.wallhogs-media.com/blog/2007/04/13/wal...

And, about you liking Zillow, that's great. I remember one of the agents that was helping me say how she did not like Zillow and that their numbers (zestimates) were incorrect and misleading. I, personally, have nothing against Zillow; it's a shame that Zillow is being punished but yet others, with similar services, aren't.

BIG Scott -

No problem, I'd easily and readily confused...

As for Zillow, be sure to see the latest post. I LIKE Zillow, and I want them to stay around -- whether their Zestimates are good, bad or indifferent.

And a wallhog would indeed stand out. I need to put on my creative hat and ponder this a bit more.....

Thanks for visiting!

Jay, first off, sorry if I confused you. I was saying that realtors would be happy to hear the news about zillow since zillow's numbers are always off from the numbers that realtors are trying to use (or at least they were when I was shopping for my home in vegas).

With regards to the Wallhogs being used by realtors for marketing and advertising- it's creative, it's unique and it's also a novelty item for your clients to better remember you (and refer you) by. Certainly, a Wallhog on the wall with your professional information will stand out amongst the plain, ordinary business cards that will be all over the counter.

Agree Jay. It's nothing but a Black Ops Legislation attempt.

"Really that makes no sense at all though. How does a lesser qualification exempt you from the requirement of having a higher one?"

Welcome to my nightmare. NONE of it makes any sense. About the only way one can make sense of it is if you step back and say, "Hmmm, *what if* someone got a bug up their ass and decided to outlaw Zillow, and Zillow only, from providing property valuation estimates? How would they go about outlawing Zillow?"

This absurd action being taken by the AZBoA and the Arizona legislature appears to be attempting to do just that. It's mind-numbingly stupid. It's really (to me) beyond comprehension.

If you try to interpret the legislation literally, it appears that it will also make it illegal for two neighbors to stand on their driveway and discuss the value of their homes. Or laugh at what the guy down the street is listed at. Of course that would be completely unenforceable, but that's the way it reads...

Really that makes no sense at all though. How does a lesser qualification exempt you from the requirement of having a higher one?

Assuming that having an appraisal license is so vital to creating an opinion of value. Why are real estate agents allowed to perform a CMA, something beyond the scope of our licenses, without a licensed appraiser viewing and signing off on it.

It's kind of like saying only doctors can write scripts for medications unless they are a nurse and aren't charging for it. It's completely bizarre.

If my CMA number is badly wrong, can I be sued for it? After all its not like I am a licensed appraiser or anything. I believe pre-licensing class spent about 1 hour on CMA's. Thats hardly expert training.

Zillows errors are public knowledge, but I'm sure plenty of agents produce equally laughable CMA numbers. You just need to look at some of the overpriced properties and see agents mentally cashing commission checks and buying open house ads in newspapers to know that they are clueless about market value.

The only difference between a CMA and an appraisal is that you can use one to get a mortgage approved. It's not like you can use a zestimate to get a mortgage approved. I don't really see much difference between a zestimate and a CMA to be honest.

There is a line in the proposed legislation that "exempts" real estate agents from all the nonsense.

In other words, we'll still be able to do CMAs... for now.

Well spotted JF.

It would seem that a CMA by any real estate agent would clearly fall under that description of giving "an opinion of value".

Will the board also be sending cease and desist letters to all the residential brokerages?

It seems like selective enforcement. The way the Arizona law is written, you and I would be considered appraisers if we gave an opinion of value. Under the Arizona law an appraisal is "an opinion of value". The law is ill-written in my legal opinion. I believe AVM values are clearly not meant to be appraisals as that term of art is used nor in the legal sense.

Here is the link to the C&D letters, one of which quotes the law.
http://www.workingre.com/workingre/Cease-and-desi...

Is it the heat or lack of humidity which causes this?

Great points. It is interesting. Zillow has been a household name that I here many people claim to use...or now have used. This is just another example of how the state organizations never cease to amaze me with with their ridiculous logic.

BIG Scott -

Why in the world would Realtors be happy to hear about this?

And I guess I'm not creative enough to see why big giant vinyl stickers would be good for marketing. Maybe I could stick on on wall of a listing? Have it say. "CALL JAY TO BUY THIS HOUSE NOW!"

Somehow I suspect the sellers wouldn't see that as a positive...

I know a lot of realtors should be happy to hear about this.

I work for Wallhogs and we just began making Wallhogs for some realtors to use for their advertising and marketing. Is this something that would work in your industry? You've got my email now, let me know if this is something that you'd be interested in hearing more about. I can show you some examples and explain anything that needs explaining.

Thanks,

Scott at Wallhogs

Yeah it's madness at work here really. It's going to completely backfire on the appraisers too. If people didn't know about Zillow in AZ before this, they will know about it now.

The appraisers are going the right way to do one very very bad thing... stop the public from visiting a website they like. The fallout could be nasty.

LOL how has the sub-prime stuff been playing out in AZ? Not sure now is a good time to call names and point fingers if I was in appraisals.

Athol, I'm glad you said this:

"Just pull what comps you want until it comes out what you want it to." Because the Internet is making it easier and easier for anyone to pull comps. I'm no expert, and I'm certainly no realtor, but it was easy as pie for me to pull comps myself from a Denver neighborhood or Denver zip code (here if you want to look http://www.cohomefinder.com/browse-ci-Denver-zip-... and start drawing conclusions about values.

Joel - welcome, thanks for commenting! Interesting eval tool. I don't know the laws in Colorado, but if you were here, having the word "appraisal" in it could wind up getting you in a little trouble. Probably worth confirming it's OK in CO.

Athol - as always, your commentary is spot on!

Well lets be honest about CMA's here too. I often say a CMA stands for Could Mean Anything. It's all on the comps you pull. Honestly any agent with half a brain can make a CMA turn out +/- 15% on whatever fair market value is. Just pull what comps you want until it comes out what you want it to.

For me the real CMA number is just a gut feeling after I do the math and see the house. It's about knowing the market and having a educated... well... guess.

Long time lurker, first time poster...

This is a great thread. In our Colorado Market, we've struggled with the wildly random "zestimates". Often, they're surprisingly accurate, but when they're off, they can be off by as much as 15%. To further complicate things, it's hard to identify without a good bit of diligence whether they're 10% high or 10% low, and the instant home evaluation almost seems to create more work than just doing an old-fashioned CMA.

Although we belive in Automation, it needs to be flexible enough to adapt to necessary changes and with Zillow -- so much of their algorithm is "behind the curtain" that it's hard to identify what changes need to be made. For this reason, we developed an evaluation tool to help our agents brainstorm interactively with clients about the value of their home.

If you'd like to check it out, feel free. With a few exceptions, we feel that its principles can be applied in any market:
http://www.automatedhomefinder.com/appraisal

No problem Jay. If you have any questions, please don't hesitate to let me know. I also did a blog post on our Wallhogs blog which may help to explain a bit more-

http://www.wallhogs-media.com/blog/2007/04/13/wal...

And, about you liking Zillow, that's great. I remember one of the agents that was helping me say how she did not like Zillow and that their numbers (zestimates) were incorrect and misleading. I, personally, have nothing against Zillow; it's a shame that Zillow is being punished but yet others, with similar services, aren't.

BIG Scott -

No problem, I'd easily and readily confused...

As for Zillow, be sure to see the latest post. I LIKE Zillow, and I want them to stay around -- whether their Zestimates are good, bad or indifferent.

And a wallhog would indeed stand out. I need to put on my creative hat and ponder this a bit more.....

Thanks for visiting!

Jay, first off, sorry if I confused you. I was saying that realtors would be happy to hear the news about zillow since zillow's numbers are always off from the numbers that realtors are trying to use (or at least they were when I was shopping for my home in vegas).

With regards to the Wallhogs being used by realtors for marketing and advertising- it's creative, it's unique and it's also a novelty item for your clients to better remember you (and refer you) by. Certainly, a Wallhog on the wall with your professional information will stand out amongst the plain, ordinary business cards that will be all over the counter.

Agree Jay. It's nothing but a Black Ops Legislation attempt.

"Really that makes no sense at all though. How does a lesser qualification exempt you from the requirement of having a higher one?"

Welcome to my nightmare. NONE of it makes any sense. About the only way one can make sense of it is if you step back and say, "Hmmm, *what if* someone got a bug up their ass and decided to outlaw Zillow, and Zillow only, from providing property valuation estimates? How would they go about outlawing Zillow?"

This absurd action being taken by the AZBoA and the Arizona legislature appears to be attempting to do just that. It's mind-numbingly stupid. It's really (to me) beyond comprehension.

If you try to interpret the legislation literally, it appears that it will also make it illegal for two neighbors to stand on their driveway and discuss the value of their homes. Or laugh at what the guy down the street is listed at. Of course that would be completely unenforceable, but that's the way it reads...

Really that makes no sense at all though. How does a lesser qualification exempt you from the requirement of having a higher one?

Assuming that having an appraisal license is so vital to creating an opinion of value. Why are real estate agents allowed to perform a CMA, something beyond the scope of our licenses, without a licensed appraiser viewing and signing off on it.

It's kind of like saying only doctors can write scripts for medications unless they are a nurse and aren't charging for it. It's completely bizarre.

If my CMA number is badly wrong, can I be sued for it? After all its not like I am a licensed appraiser or anything. I believe pre-licensing class spent about 1 hour on CMA's. Thats hardly expert training.

Zillows errors are public knowledge, but I'm sure plenty of agents produce equally laughable CMA numbers. You just need to look at some of the overpriced properties and see agents mentally cashing commission checks and buying open house ads in newspapers to know that they are clueless about market value.

The only difference between a CMA and an appraisal is that you can use one to get a mortgage approved. It's not like you can use a zestimate to get a mortgage approved. I don't really see much difference between a zestimate and a CMA to be honest.

There is a line in the proposed legislation that "exempts" real estate agents from all the nonsense.

In other words, we'll still be able to do CMAs... for now.

Well spotted JF.

It would seem that a CMA by any real estate agent would clearly fall under that description of giving "an opinion of value".

Will the board also be sending cease and desist letters to all the residential brokerages?

It seems like selective enforcement. The way the Arizona law is written, you and I would be considered appraisers if we gave an opinion of value. Under the Arizona law an appraisal is "an opinion of value". The law is ill-written in my legal opinion. I believe AVM values are clearly not meant to be appraisals as that term of art is used nor in the legal sense.

Here is the link to the C&D letters, one of which quotes the law.
http://www.workingre.com/workingre/Cease-and-desi...

Is it the heat or lack of humidity which causes this?

Great points. It is interesting. Zillow has been a household name that I here many people claim to use...or now have used. This is just another example of how the state organizations never cease to amaze me with with their ridiculous logic.

BIG Scott -

Why in the world would Realtors be happy to hear about this?

And I guess I'm not creative enough to see why big giant vinyl stickers would be good for marketing. Maybe I could stick on on wall of a listing? Have it say. "CALL JAY TO BUY THIS HOUSE NOW!"

Somehow I suspect the sellers wouldn't see that as a positive...

I know a lot of realtors should be happy to hear about this.

I work for Wallhogs and we just began making Wallhogs for some realtors to use for their advertising and marketing. Is this something that would work in your industry? You've got my email now, let me know if this is something that you'd be interested in hearing more about. I can show you some examples and explain anything that needs explaining.

Thanks,

Scott at Wallhogs

Yeah it's madness at work here really. It's going to completely backfire on the appraisers too. If people didn't know about Zillow in AZ before this, they will know about it now.

The appraisers are going the right way to do one very very bad thing... stop the public from visiting a website they like. The fallout could be nasty.

LOL how has the sub-prime stuff been playing out in AZ? Not sure now is a good time to call names and point fingers if I was in appraisals.