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Realty Trac's "Estimated Market Values" are set way too low.
(TX)

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Top 75 Contributor
3 Posts
lutece7 posted on 23 Jul 2012 11:33 AM

 

I don't understand why all the homes in foreclosure listed on RealtyTrac have "Estimated Market Values" that are 1/3 to 1/4 what they actually are.

I found a home RealtyTrac says has an Estimated Market Value of $105,000, but soon learned that the comp sales for that neighborhood were $315,000.

Another house, with a Realty Trac estimated market value of $124,000 has a tax assessment listed as $420,000

I could go on and on, with more examples.

How do you come up with $105,000? are these numbers city-wide comp sales based? instead of neighborhood wide based? or what?

Chris

 

 

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Top 75 Contributor
3 Posts
lutece7 replied on 23 Jul 2012 11:41 AM

Is RealtyTrac basing the  Estimated Market Values.  on, for example,  the entire City of Dallas Texas???? or on the specific neighborhood. It would appear they they are based on an entire city, which is not helpful. All cities have wide variances in prices. We want to know what the market value is for a specific neighborhood. That is how real estate buying and financing works.

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Top 75 Contributor
3 Posts
lutece7 replied on 27 Jul 2012 07:05 AM

home I was following with a RealtyTrac Estmated Market Value of $105k just had its opening bid posted at $288k. RealityTrac isn't not tracking realty when it comes to Estimated Market Value. 

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Top 10 Contributor
Male
324 Posts
darenb replied on 29 Jul 2012 01:56 PM

Thanks for your comments about the estimated market values. These are based on what's called an Automated Valuation Model (AVM), which is based on the comparable sales of homes in the area; however, it is automated and certainly not perfect.

 

There are certain areas where the AVM may be more susceptible to problems, and one of those is some areas in Texas because Texas is what's called a non-disclosure state when it comes to home prices and so the sales prices are not always included in the sales deed documents we collect.

 

That said, one great way to double check the AVM on RealtyTrac is to click on the "Comp Sales & Listings" tab on any property details page to see other properties in the area that have recently sold as well as other properties listed for sale. This allows you to more specifically check what other similar properties nearby have sold for and what other similar properties nearby are listed for sale at, which may in some cases be a better way to determine the home's true fair market value than the AVM. Also provided on this tab are calculations of the average comparable sales price and the average comparable listing price.

 

The video below shows an example of a property with no AVM, but where there are comparable sales and listings to help determine the fair market value of the foreclosure home.

 

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