Every seller I meet has already looked up their number. Sometimes three numbers, from three sites, none of which agree. Here is what those estimates are actually measuring, why they disagree, and why none of them is the price we’d list your home at.
There are three different numbers, and people conflate them
Most of the confusion here isn’t about accuracy. It’s that three separate things all get called “what my home is worth.”
- An automated valuation (AVM). A statistical model. It reads public records and recent sales, finds patterns, and outputs a number. No human involved, no one has seen your house. Homebot, Zestimate, and every bank’s instant estimate are this.
- A comparative market analysis (CMA). What I do. A licensed agent pulls genuinely comparable sales, adjusts for the differences, and factors in what’s happening right now — how fast things are moving, what buyers are rejecting, what just went pending down the block.
- An appraisal. A licensed appraiser’s formal opinion, usually ordered by a lender to protect the loan. It carries legal and financial weight the other two don’t.
Three different methods, three different purposes, three different numbers. That they disagree isn’t a malfunction.
What the algorithm can’t see
An AVM knows your square footage, bed and bath count, lot size, year built, and what nearby homes sold for. That’s a real foundation. It’s also everything it knows.
It doesn’t know that you gutted the kitchen three years ago, because a permit record is not a finish level. It doesn’t know your comparable sale was a gut job and yours isn’t. It doesn’t know your lot backs onto a park, or a frontage road. It doesn’t know the light in your living room at four o’clock in January, which in Minnesota is worth actual money.
It also doesn’t know condition, which is the largest single variable in older Twin Cities housing. Two 1926 bungalows on the same block, identical on paper, can be sixty thousand dollars apart in reality — and no model can tell them apart, because the difference is a furnace, a roof, and whether the basement smells right.
Rule of thumb: the more ordinary and recently built your home is, the closer the estimate lands. Unusual homes, custom work, small or thinly-traded neighborhoods, and anything on an odd lot — that’s where the models drift furthest.
Why your number keeps moving
Estimates jump for reasons that have nothing to do with your house. A neighbor sold. A neighbor sold badly. A county record updated. The model itself got retrained.
This is why watching the estimate weekly is a bad use of your attention, and why watching the trend over a year or two is a good one. Direction is signal. Week-to-week movement is mostly noise.
When the estimate is genuinely worth having
I recommend these tools, which is worth saying out loud after four sections of caveats. They’re just good at different things than people assume.
- Tracking equity over time. The single best use. Most homeowners have a badly outdated sense of their own position.
- Spotting when mortgage insurance can go. If your equity has crossed the threshold, that’s a monthly payment change worth chasing down with your lender.
- Sizing up a move before it’s a plan. Roughly what you’d net, roughly what that buys, without a single conversation with an agent.
- Refinance timing. Equity position drives options.
What it isn’t good for is the one thing people use it for: setting a list price. Overprice a Twin Cities listing on the strength of a favorable estimate and you’ll spend the first two weeks — your most valuable two weeks — being the comparison that makes a competitor look reasonable.
What I do instead
I walk the house. Then I pull comparable sales and defend each one, because a comp two blocks away in a different school attendance area or across a busy arterial may not be a comp at all. Then I adjust for what’s genuinely different, look at what’s currently active and pending, and give you a range with reasoning attached — along with what happens at each end of it.
You should be able to argue with that number. If your agent can’t explain how they reached it in terms you can push back on, that’s not a valuation. It’s a guess with a logo.
Start with the estimate. Then get the real number.
Run the automated version to see where you stand — it’s free and takes a minute. When you want a price you can actually list at, I’ll walk the house and show you the comps.
Get your instant estimate · See how selling works · Ask me for a CMA
Automated estimates are not appraisals and are not a substitute for professional advice. Figures used for illustration only.
