Why the Zestimate and your agent disagree

You looked up your house. The number was higher than what your agent said. That is an uncomfortable conversation and it is worth understanding what is behind both figures.

What an automated valuation actually is

An automated valuation model takes public records — assessments, past sale prices, square footage, bed and bath counts, lot size — plus recent nearby sales, and runs a statistical model over them.

It is a genuinely impressive piece of statistics operating on genuinely incomplete data.

Here is what it does not know about your house:

Condition. It cannot tell a renovated kitchen from a 1978 kitchen. If you put $40,000 into the house, the model has no idea unless a permit happened to record it.

Interior layout. Two 1,600-square-foot ranches with identical records can be worth $30,000 apart because one has a usable floor plan and one does not.

What the view is. Backing onto conservation land versus backing onto a commercial parking lot does not appear in any field it reads.

The road. A busy road is a real discount. Nothing in the record says “busy.”

The condition of the sales it is comparing you to. This is the big one. If three nearby houses sold recently and all three were renovated, the model reads those prices as your neighbourhood's value and applies them to your unrenovated house.

What the error range means

Portals publish an accuracy figure — typically a median error in the low single digits for on-market homes, higher for off-market ones. Two things about that number.

It is a median, so half of all homes are off by more than it. And it is much better for on-market homes, because once a house is listed the model gets to see the asking price, which is a very strong hint.

On a $400,000 house, a few percent is $8,000 to $20,000 in either direction. That is a meaningful range when you are deciding whether to accept an offer.

What a comparative market analysis does differently

An agent preparing a CMA starts with the same recent sales and then does the part the model cannot: looks at them.

Which of those houses were renovated and which were not. Which had a finished basement that the record calls unfinished. Which sold with $10,000 in concessions that made the recorded price look higher than the real one. Which sat for ninety days before selling, and which had three offers in a weekend.

Then the same work on yours. Walk it, assess the condition honestly, note what is better and worse than each comparable, and adjust.

The output is a number with reasoning attached — and the reasoning is the valuable part, because you can argue with it.

When the automated number is high, and when it is low

It tends to run high on dated houses in renovated neighbourhoods, on busy roads, and on homes with deferred maintenance.

It tends to run low on recently renovated houses where no permit captured the work, on unusual properties with few comparables, and on homes whose best feature is something the record cannot see.

If you have put real money into your house, the automated figure is probably under you. If you have not touched it in twenty years and your street has been turning over, it is probably over you.

What to do with both

Use the automated number as a sanity check, not as a price. If an agent tells you something wildly different in either direction, ask which comparable sales they used and what adjustments they made. A good answer is specific. A bad answer is “that's what the market is telling me.”

We will put together a real CMA on your property at no cost — the comps, the adjustments and the reasoning, so you can see how the number was built rather than being handed a figure.

And if what it shows is that this is not the right moment to sell, we will tell you that. We have told plenty of people that.

Zack DeCaro is a licensed real estate broker in Connecticut and Massachusetts with Property Works New England in Rocky Hill. He has prepared 1,500+ broker price opinions.