Zillow’s Zestimates are really just estimates, appeals court rules

Upholds lower court decision that the online valuations aren’t meant to be precise appraisals

Chicago /
Feb.February 19, 2019 09:00 AM

Zillow CEO Spencer Rascoff (Credit: Getty Images and Pixabay)

A federal appeals court upheld a lower court’s ruling that Zillow Group’s “Zestimates” aren’t meant to be precise appraisals of a home’s value.

Last year, a U.S. District Court judge ruled that the online brokerage did not violate consumer fraud laws through its use of the much-maligned online valuations, and earlier this month, a federal appeals court upheld that ruling, according to the Cook County Record.

The suit by a group of Chicago-area homeowners had alleged Zillow leads homebuyers to believe Zestimates are precise calculations of a home’s current market value, when in fact they’re often inaccurate.

One plaintiff said he listed his home for almost $1.5 million, but alleged a Zestimate of $1.33 million scared off potential buyers.

St. Eve had ruled Zestimates were merely an estimate of the market value of a property, and said Zillow’s website makes that clear. The appeals court agreed, rejecting the plaintiffs’ appeal.

The lawsuit is not the only legal fight surrounding Zestimates, which residential brokers say make it harder when it comes time to set a listing price with clients. A lawsuit filed in New Jersey claimed Zillow conceals Zestimates on residential listings at the request of brokerages that have “contracts” with the site. [Cook County Record] — John O’Brien

 

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