How We Sold Our House to Zillow for a Profit

This post is NOT sponsored by Zillow. This is an actual account of my experience of selling a house directly to Zillow in 2019.

In the Spring of 2019, we sold our Phoenix, AZ home to Zillow for a profit after owning it for two years. I'll run through the steps of our transaction and our opinion of the process.

How it Began

Let me start by saying we aren't the type of family that buys a house to live in forever. In fact, the very thought of being stuck in one house for the rest of my life gives me the heebie-jeebies.

There was an understanding from the beginning, in the Spring of 2017, that our home was a temporary place to live.

I continually track the the Z-Estimate value of my house. I did it then, I do it now. I use the Z-Estimate value to calculate the fair market value of our house as an asset (a component of our net worth). Some people don't treat their primary residence as an asset, but I disagree. Since we house hop every 2 years, the market value of our house is important.

Furthermore, as an accountant I know that if you have a huge liability on your “books” (your mortgage), it doesn't make sense not to have the offsetting asset (your house). Instead of using the book value of the house, it makes more sense to use a market value.

So we use the Zestimate because its a readily-available number, updated regularly, and easy to obtain.

According to Zillow, “the Zestimate home valuation is Zillow’s estimated market value for a home, computed using a proprietary formula. It is a starting point in determining a home’s value and is not an official appraisal. The Zestimate is calculated from public and user-submitted data.” ^[1]

The price we paid for our house was below market value. We had equity built in from day one.

Its one of the reasons we chose that particular home. It wasn't a dream home for either of us, but we thought it was a good investment.

Zillow

One day, as I was looking at our house on Zillow, I noticed a message on the site: “Get a Zillow Offer. No staging, no showings, no repairs. Move when you're ready.”

On a whim, I clicked the button.

A few days later we were contacted by a Zillow real estate agent with an initial offer on our house. Yes, it was that simple.

I almost fainted when I saw the price – the sales price was over $100,000 more than what we paid for it a year before. From that amount they deducted an estimate for renovations and fees. Some might complain that the fees are too high, or the reno budget is too high, or whatever.

I find more value in looking at the net profit. The net profit is what you'll take home when the sale is complete. If that number meets or exceeds your expectations, who cares how they got there?

The initial offer was accompanied by the following message:

“Keep in mind this is sight unseen and it is possible we either estimated too much or too little for prep and repair. Next step is to get you that free, no obligation home evaluation scheduled so that we can come back with our final offer for you.
Let me know how you'd like to proceed!”

The Inspection

We eagerly accepted the initial offer, and the next step in the process was to send an inspector to our house. He was there for 30 minutes to an hour, measuring rooms and taking pictures with an Ipad. The inspection was not as intense as we expected.

He left, and a few days later we received a final offer on the house. The sales amount remained the same, with an adjusted amount for renovations and fees. The net amount represented a $40,000 profit for us.

We accepted, and were given the option of choosing the sales date – any time between 30 and 90 days.

We were baffled. It almost seemed too easy.

The Transaction

The process went so smoothly that it was hard to believe it was a legitimate offer. After we chose our transaction date, Zillow contacted us with expectations on the condition in which we should leave the property.

No one came to check on us, or to make sure we were moving out. No one came the day before to make sure the house was still standing. We moved out before the closing date, showed up to sign the paperwork at the title company on the assigned date, and a couple of days later, the funds hit our bank account.

It was almost surreal.

Our Review

Selling our house to Zillow was a simple process. We never had to list our property, show it to potential buyers, or go through any of the hassle that most home sellers deal with.

Zillow paid at or above market price for our house (we believe it was above). We thought it was a very generous offer at the time. We knew exactly what the net profit was going to be early in the process.

They didn't micromanage us, or contact us at all after we accepted other than asking us to communicate some information to the title agency and providing move-out expectations. It was almost too easy.

Would I sell another house to Zillow? I'd love to sell all my houses to them!

Unfortunately, Zillow isn't buying houses everywhere. There are certain markets they targeted, and Bend, Oregon isn't one of them. But with property values skyrocketing in Bend, we don't think we will have any problem selling our current house the old-fashioned way for a nice profit in 2021.

Zillow Markets

As of the time of this article, Zillow Offers is available for sellers in Atlanta, Austin, Texas, Charlotte, N.C., Cincinnati, Colorado Springs, Colo., Dallas, Denver, Fort Collins, Colo., Los Angeles, Minneapolis, Nashville, Tenn., Orlando, Fla., Phoenix, Portland, Ore., Raleigh, N.C., Riverside, Calif., Sacramento, Calif., San Antonio, San Diego and Tucson, Ariz.

For more information on selling your home to Zillow, visit https://www.zillow.com/offers/.

[1]https://www.zillow.com/how-much-is-my-home-worth/