How to price this property?

[Emerson Miranda]

BPers, I need to make an offer on a 3 Units in the lot. It has a 2bed, 1Bath in front. A 1bed, 1bath in the back, and a 1bed, 1bath on top of the back unit, with 1 car garage for each unit. Zestimated in $840k. A Triplex next to it with new houses are $600k each. Thinking about a $550k offer. Any thoughts! Regards, Emerson Miranda

[Simon Campbell]

Zillow can provide you with a free estimate. But how accurate is their estimate? According to Zillow’s own Zestimate data accuracy report, they have a median error rate of 6.9%. In fact, further down in their report they state that only 38.3% of the time are they within 5% of the actual sales price. The reality is that they are 20% off the actual sales price 84.7% of the time.

In the wholesaling business, a 20% mistake in pricing is suicidal. Follow the Zestimate's price recommendations and you could very well lose all your profit on every deal. You need to base any purchase decision on actual verified comps along with active listings from the local MLS.