To use, or Not to use? Zillow?

So I'm sure that many of you in the real estate business are fairly familiar with Zillow. For those not familiar with it, Zillow is a fun online tool that is used to estimate the value of homes in any given area. But I have a concern, and it's not with how accurate it is, but more so, is it smart to have your clients utilizing it?

In a recent article by the Wall Street Journal, they brought into question the capabilities of Zillow and it's estimates. Where a majority of the time, the values where with in a few percent. But as stated in the article, when Zillow was wrong, it was WRONG. At times over estimating by 50% or more.

Now, we know technology can only do so much. But is it smart for us to recommend clients to use this site? I have heard many clients in the past mention Zillow, and how they loved to send their clients there to play around with home values, and get a feel for the market. But with something so far off at times, I think this is doing more damage then good.

Clients looking to buy in an area could definitely get the wrong perception of what the area costs if they go by the Zillow numbers. People may begin to think that they can afford homes in an area that in all honesty is well out of their budget. The last think any one wants is a discouraged buyer.

Then you have sellers. Now for me, this is a nightmare. Especially for those of us that have worked with clients that think their home is all ready priced too low. They jump on Zillow, do a search, and get back a number that's 90 or 160k higher then what they're listing the home for. That's all you need right? A seller that now thinks what they see online is fact? It's not helping out the situation.

Here is a link to the Wall Street Journal article. Read it and let me know what you think...

Zillow Article