PHOENIX - The Arizona Board of Appraisal issued two cease-and-desist letters to company that operates the popular real estate Web site Zillow, saying it needs an appraiser license to offer its "zestimates" in Arizona.
"It is the board's feeling that (Zillow) is providing an appraisal," Deborah Pearson, the board's executive director, said Friday.
Zillow warns users the estimates it provides are not a definitive value but a starting point for consumers. Launched in February, 2006, the company claims it has 4 million users a month, including people wanting to how much their homes -- or their neighbors' homes -- are worth.
The site has been criticized by real estate professionals and others concerned about its accuracy.
A complaint was filed in October with the Federal Trade Commission by the non-profit National Community Reinvestment Coalition, alleging Zillow was misleading consumers and others with its estimates.
"We have responded to the letters from the Arizona Board of Appraisal and hope to engage in a productive dialogue with them," said Amy Bohutinsky, Zillow director of communications.
The Phoneix Real Estate Guy blog thinks - "This is just plain idiotic and asinine. "
Have cease and desist letters also been delivered to Coldwell Banker, Bank of America, Domaina (Lending Tree), Devenio, National Property Value, Homegain, Home Appraisals USA, RealEstate.com, or any of the other similar sites offering automated valuations that are scattered all over the Internet?
From the Bloodhound blog:
Further notice: Official Zillow.com response from David Gibbons:
Lloyd Frink, Zillow’s President asked me to convey this official response to you, Greg:
“We strongly believe that providing Zestimates in Arizona is completely legal (and in fact an important public service), given that Zestimates are the result of our ‘automated valuation model’ and are not a formal appraisal. The Arizona Board of Appraisals relies on USPAP, the national professional standards for appraisers, and USPAP Advisory Opinion to determine propriety of activities. Here is the relevant opinion on this matter (Advisory Opinion 18): http://commerce.appraisalfoundation.org/html/2006%20USPAP/ao18.htm As you can see, it reads: ‘The output of an AVM is not, by itself, an appraisal.’”
From Inman News: click here
"The letters just ask that they cease and desist from the appraisal activities, and if they don't the board will have to pursue injunctive relief," said Pearson. The letters, dated July 31, 2006, and Nov. 28, 2006, state that the Uniform Standards of Professional Appraisal Practice, a generally accepted national standard for professional appraisers, "define 'appraisal' as an opinion of value" and that Zillow is "not a licensed or certified appraiser in the state of Arizona."
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