Zillow, the website that brought you the Zestimate, now has a brand-new feature to make fun of. We’ve all chuckled over how surprisingly off the Zestimate of a home’s value could be. Well, in the words of Mr. Family Guy, “You think that’s bad?”
Zillow has just introduced the Rent Zestimate. Yes, now we can compute the Zrent Zratio, using two estimates that may or may not have anything to do with reality! Let’s try it with a few houses previously featured on Burbed!
Here’s Friday’s house, the Tangrams Set with the High-Tech name. Once more, the Zestimate has no relation to real life, because if it did this place wouldn’t be sitting unclaimed for 113 days at $200K less than Zillow’s amazing valuation model’s prediction. To compute the Zrent Zratio, divide the Zestimate by the annual Rent Zestimate. For this house, $762,000 divided by ($3081 * 12) is 20.6, a number that says rent, don’t buy this house. (A number above 15 says rent, a number below 15 says buy.)
Although I think the answer is really don’t rent or buy this house, so let’s try again with something a little more desirable. So let’s stop and smell the roses.
Well, here’s a Zestimate a little more down to earth, as this Beautiful Specious Home is listed for $239,000. The Zrent Zratio is $217,500 / (1345 * 12) or 13.5. Buy! Buy! BUY!
And here’s our most recent run-in with MAWBUL CAWLUMS, it’s the Shrek House.
Ready? Oh oh, this place has a Zestimate about 30% of the asking price. I didn’t say 30% lower, I said it’s 30% of the asking price. I’m sure the FBs will be happy to set Zillow straight on this. And the Zrent Zratio is… $1,427,000 / (5587 * 12) = 21.3. Rent. Definitely rent.
Okay, now for grins, we’re going to compute the rent ratio using the wishing prices of all three homes, and Zillow’s Rent Zestimate.
- Poinsettia: $575,000 / (2979 * 12) = 16.1 (weak rent, buy it if you love it)
- Gibraltar: $217,500 / (1345 * 12) = 14.8 (buy or rent, it’s a wash)
- Butch: $4,999,000 / (5587 * 12) = 74.6 (rent rent rent rent rent rent are you kidding me?)
So, what do you think of Zillow’s new made up numbers? Do any of these rents have anything to do with reality? And if you divide one invented number by another, does the nonsense cancel itself out?