Greg's Corner

Zillow has Zestimate lawsuit thrown out

Back in May, we posted how real estate site Zillow was being sued over their ‘Zestimate’ feature. The lawsuit claimed Zillow’s estimates were undervaluing the homes which were being sold on Zillow and that Zestimates were a de facto appraisal. In Illinois, where the suit was filed, all real estate appraisers have to be licensed in the state.

Zillow can breathe a zigh of relief for now, as the lawsuit has been dismissed by a U.S. District Judge in Chicago. The judge ruled the portmanteau of Zillow and estimate, creating Zestimate, clearly shows consumers it is an estimate and not an appraisal and Zestimates were just a starting point for people looking to buy a home. The judge also ruled Zillow did not violate Illinois’ Real Estate Appraiser Licensing Act.

The plaintiffs will no doubt try to file an amended lawsuit since they still claim Zestimates are affecting property values negatively.