This is an estimate of your property value by analyzing local listings and public data, determining trends, and applying them to your property. This is a basic evaluation and is useful for demonstrating trends. Since every home (and market) is different, it is essential to look at this information in detail.
For most agents their main business is not evaluating. It is not uncommon to have values overstated to get a listing. In addition, the agent's information is mostly only as accurate as the agent’s knowledge of the area – they typically “eyeball” property differences and make judgments based on their experience.
A more accurate approach is called a broker price opinion, or BPO. Some agents have completed special training to do this work, and lenders (banks) often request BPOs to determine the value of foreclosure homes before putting them up for sale. This is almost always compared and combined with the pre-listing appraisal for lenders to determine listing values. These are also often used for short sales, litigation, and divorce proceedings.
To perform a BPO, the broker typically examines three recent local sales of property similar to yours, and three currently-listed houses, compares their condition and features to yours, makes numeric adjustments according to formulas, and offers a value estimate.
I have over 12 years of heavy BPO experience working directly with lenders to determine property values. After hundreds and hundreds of BPO assignments over the course of my career, I am able to deliver a very high degree of valuation accuracy to my clients. You can count on me to follow up to help navigate and answer any questions or concerns you may have.