The error rate of Redfin’s AVM improved five basis points and expanded to the state of Connecticut as well as the cities of Boise, Des Moines, Spokane and Chattanooga.

Redfin has refined the Redfin Estimate, the company’s property automated valuation model, it was announced.

The adjustment, announced Friday, improves Redfin Estimate’s accuracy for off-market homes by 70 basis points and improves the overall accuracy of the tool by five basis points, according to the company.

Bridget Frey | Photo credit: Redfin

For off-market homes the company claims the median error rate improved to 5.6 percent, meaning half of all Redfin Estimates fall within 5.6 percent of the eventual sales price. The error rate for both on-market and off-market homes dropped to 1.57 percent nationally and Redfin regularly updates the error rate regionally on its website. 

“Everyone wants to know what their home is worth, which is why the Redfin Estimate drives so many homeowners to visit our site and start a conversation with a Redfin agent,” Redfin Chief Technology Officer Bridget Frey said in a statement.

“In real estate, every tenth of a percentage point matters and can represent hundreds or thousands of dollars in a home’s value,” Frey added. “Agents know that a smart, data-driven pricing strategy is often the difference between a home that sells quickly with multiple offers and one that sits on the market.”

Frey explained that the accuracy of the Redfin estimate speaks to the company’s advantage as a brokerage that uses employed agents, who can work alongside engineers and provide human insights to help train the company’s machine learning algorithms.

The improvement of the tool is also a boon to RedfinNow, the company’s direct-to-consumer homebuying and selling business.

Quinn Hawkins | Photo credit: Redfin

“The new release not only improves the accuracy of the estimate, it includes back-office tools that show the confidence of the estimate and project the future sales price, so we can better assess the risk and opportunity of buying a particular home,” Quinn Hawkins, head of RedfinNow, said in a statement.

“With continued advancements in AI and machine learning, we can envision a future where the Redfin Estimate becomes a live offer for a subset of properties,” he added.

The Redfin Estimate also expanded to five new markets: Connecticut; Boise, Idaho; Des Moines, Iowa; Spokane, Washington; and Chattanooga, Tennessee. It can also now provide estimates for land, mobile homes and multi-family buildings.

Last year, the tool came under fire from some corners of the industry who believed it contributed to rising home prices. 

Email Patrick Kearns

Are you ready for what the industry holds in 2020? Inman Connect New York is your key to unlocking opportunity in a changing market. At Connect you will gain insight into the future, discover new strategies and network with real estate’s best and brightest to accelerate your business. Create your 2020 success story at Inman Connect New York, January 28-31, 2019.

Agenda | Speakers | Past Connect Videos

Thinking of bringing your team? There are special onsite perks and discounts when you buy tickets together. Contact us to find out more.

Show Comments Hide Comments

Comments

Sign up for Inman’s Morning Headlines
What you need to know to start your day with all the latest industry developments
By submitting your email address, you agree to receive marketing emails from Inman.
Success!
Thank you for subscribing to Morning Headlines.
Back to top
Limited time: Get 30 days of Inman Select for $5.SUBSCRIBE×
Log in
If you created your account with Google or Facebook
Don't have an account?
Forgot your password?
No Problem

Simply enter the email address you used to create your account and click "Reset Password". You will receive additional instructions via email.

Forgot your username? If so please contact customer support at (510) 658-9252

Password Reset Confirmation

Password Reset Instructions have been sent to

Subscribe to The Weekender
Get the week's leading headlines delivered straight to your inbox.
Top headlines from around the real estate industry. Breaking news as it happens.
15 stories covering tech, special reports, video and opinion.
Unique features from hacker profiles to portal watch and video interviews.
Unique features from hacker profiles to portal watch and video interviews.
It looks like you’re already a Select Member!
To subscribe to exclusive newsletters, visit your email preferences in the account settings.
Up-to-the-minute news and interviews in your inbox, ticket discounts for Inman events and more
1-Step CheckoutPay with a credit card
By continuing, you agree to Inman’s Terms of Use and Privacy Policy.

You will be charged . Your subscription will automatically renew for on . For more details on our payment terms and how to cancel, click here.

Interested in a group subscription?
Finish setting up your subscription