Listening to PRI's Marketplace this evening, and having a house that is massively under-water, I got an enormous kick out of this (link here). Listen here (link), to get the flavor of indignation. Thanks Marketplace!
Zillow's algorithms are massively over-rated, way off base, and incredibly depressing. Part of the US housing market's lack of a rebound, I attribute, to Zillow's stupidity and low ball estimates, which drive fear into buyers, and depresses everyone's market values.
I truly hope Zillow's IPO falls flat on its face and they get less than 1/2 of what they THINK they're worth.
OPERATOR: I-P-Oz.com. Can I help you?
ZILLOW: Hey, it's Zillow. I got a problem. Your website says I'm only worth $360 million.
OPERATOR: Yep, that's what our "Stocks-timate" has calculated.
ZILLOW: But I just told everyone I'm worth $500 million. You're way off.
OPERATOR: Are we? I mean, last quarter you did lose $865,000.
ZILLOW: You have to see me in person to understand. I've got a lot of character and charm! My backyard has plenty of room for an addition! I even have...
OPERATOR: Yeah, sorry. Keep in mind, the recent IPO for Pandora wasn't so hot.
ZILLOW: I don't even do the same thing as Pandora!
OPERATOR: Are you an Internet-based company?
ZILLOW: Yeah, but...
OPERATOR: I'd say that's "in the neighborhood."
ZILLOW: You know, people actually use your questionable figures to try and drive down my price. Can I just tell you how ridiculous this...
OPERATOR: Oh, wait! We just made a change to our algorithm, which may affect the value of your company. Nope, that didn't help. Now our "Stocks-timate" says you're worth $40 million less.
ZILLOW: This is crazy. I've watched how you value IPOs for five years now, and you're always off base when it comes to prices.
OPERATOR: Hmm, so you're questioning the usefulness of our service?
ZILLOW: That's exactly what I'm doing!
1 year ago