Considering California is a tract housing heavy environment, their margin of error should be much lower, but even today I comped a house that was more than $100K difference in actual value than what Zillow claimed.

Most newer homes are tract homes so there should be something to compare it to unless it's an older home or a custom home.  

------For example, I would want to do this in an area where standard construction wood-frame tract house was previously scraped and now only an empty lot in the residential area remains. 

Ive heard the cost of demo is roughly the same as the cost of impact fees and new utilities on raw land...so it's a wash.The best scenario is a lot where a previous structure was already torn down...but land in general is getting harder and harder to find.I actually know of a small tract with about 8 large lots that could be picked up in the $500k range...in the Tyrone area, but outside city limits.

You need tight boundary before you start laying out your lots.. and this was a flat piece of farm ground.. you take 260 acre tract in the mountains.. and that could cost quite a bit right there. 

My father developed/owned a 5 acre tract with 18 duplexes on it.  

I call it a 5-plex, but it is actually a 4 acre tract of land with 5 homes on it.

I used a similar approach to grading each census tract in Cuyahoga County, but mine was a far more manual process it seems.

Often times they're census tract loans. 

Even in a tract of new development the corner lot, for example might sell for a premium over the others.