"What's my house worth?" has four honest answers, and they will not all agree. An online automated valuation model (AVM) like Zillow's Zestimate or Redfin Estimate returns a number in seconds — with a median error rate around 2% on-market and 6.5–7.5% off-market, meaning half of homes are further off than that headline number. A local agent's comparative market analysis (CMA) costs nothing and takes a week. A licensed appraisal costs $300–$600 and produces a defensible number a lender will accept. An Opendoor cash offer costs nothing, arrives in about a day, and — unlike the other three — is a binding price someone will actually pay. This guide walks through all four, the accuracy band on each, and when to use which.
Key Takeaways
- AVM error rates run 2–7% off-market. Zillow reports a median near 2.4% on-market and 7.5% off-market; Redfin reports 2.1% and 6.5%. On a $500,000 home that is a $10,000–$37,500 swing per tool (Zillow, Redfin).
- A CMA and an appraisal reconcile what AVMs cannot. Both add interior condition, upgrades, and negotiation context. Licensed appraisals follow USPAP and cost $300–$600 for a typical single-family home (Appraisal Institute, NAR).
- The four methods answer different questions. AVMs give a ballpark, CMAs give a listing strategy, appraisals give a defensible number, and a cash offer gives a binding price to compare against the other three.
- A no-obligation cash offer is the only "estimate" that is actually a price. Opendoor combines comparable-sales analysis with a condition assessment and returns a binding offer — you are free to walk (Opendoor Help Center).
The short answer (before you type your address anywhere)
Your house is worth what a ready buyer will pay for it today. Every method below estimates that number; only the cash offer returns a price a buyer will honor. That is the definition of fair market value — the price a willing buyer and willing seller agree to in an arm's-length transaction. Until money changes hands, every number you see is somebody's model.
| Method | Cost | Turnaround | Accuracy band | What you get |
|---|---|---|---|---|
| AVM (single tool) | $0 | Instant | ~2% on-market, 6.5–7.5% off-market (median) | A number, not a price |
| Agent CMA | $0 | 3–7 days | 3–5% with condition data | A listing strategy |
| Licensed appraisal | $300–$600 | 1–2 weeks | 2–4% USPAP-compliant | A defensible number |
| Opendoor cash offer | $0 | About 24 hours | Binding | A real price, not an estimate |
If you want to go deeper on how to interpret the number once you have one, the complete home value guide covers the reconciliation math. This article stays focused on the decision: which method to use for the question you actually have.
Method 1 — Automated Valuation Models (AVMs)
An AVM is an algorithm that pulls recent comparable sales, public tax records, and MLS data and regresses a price for your address in seconds. Zillow's Zestimate, the Redfin Estimate, Realtor.com, Chase's home value estimator, and Bank of America's real estate center all run variants of the same approach. Each tool weights the inputs differently and refreshes on a different cadence — which is why the same house returns three different numbers across three tools on the same day.
What AVMs see: square footage, bed and bath count, lot size, year built, prior sale price, permitted improvements. What AVMs miss: the kitchen you renovated without pulling a permit, deferred maintenance a walkthrough would catch, the finished basement that never made it into the tax record. Our sibling on how home value estimates work breaks down each tool's raw data sources.
The accuracy story is public. Zillow discloses a nationwide median error rate near 2.4% for on-market Zestimates and roughly 7.5% off-market (Zillow). Redfin publishes 2.1% and 6.5% for the same categories (Redfin). Those are median errors — half of all homes are more accurate, half less. The International Association of Assessing Officers publishes the Standard on Automated Valuation Models that professional assessors use to validate AVM output; it treats an AVM as a screening tool, not a final valuation.
Math check. On a $500,000 home at a 7.5% off-market error rate, the tool could be $37,500 high or $37,500 low. That is the range you are carrying into whatever decision you make from a single AVM number.
When an AVM is enough
Tracking neighborhood equity, sanity-checking loan-to-value before you talk to a lender, or confirming your assumptions before a listing agent walks in. Not enough for setting an actual list price, an insurance replacement-cost claim, a property tax appeal, or dividing assets in a divorce or estate — those need a method that inspects the house.
Why you should check three or four AVMs and average
Any single AVM is systematically biased by its data sources. Zillow leans on user-submitted updates; Redfin weights MLS sales heavier; lender tools rely on public records. Averaging three or four tools with different underlying data usually beats trusting one. If two disagree with the other two by more than 10%, treat that as a signal to move to a CMA or an appraisal rather than picking a favorite. For the underlying variables that pull AVMs in different directions house to house, see the factors that actually influence home value.
Method 2 — Comparative Market Analysis (CMA) from a local agent
A CMA is a free report a listing agent prepares by picking three to six recent sales of similar homes within a half-mile of yours, adjusting each for square-footage difference, condition, upgrades, and days-on-market, and triangulating a value range. The agent walks the house, notes finishes and mechanical condition, and writes the adjustments by hand rather than by algorithm. Three to seven days end to end.
Four things make a CMA useful: recent comps (last 90 days), close comps (half-mile or same subdivision), similar comps (bed/bath within one, square footage within about 20%), and adjustments for what your house has that the comps do not. The mechanics live in our sibling on real estate comps; the full framework — how agents pick comps and structure the adjustment grid — is in the comparative market analysis explainer.
The trade-off: agents providing a free CMA are prospecting for your listing, and some inflate the number to win the pitch. The counter-move is to ask two or three agents independently and treat the mid-point as the working estimate. If one agent's number is 8% higher than the other two, that is usually a listing-conversion move rather than a market signal.
What a good CMA looks like on paper
A one-page grid: your house on the top row, three to six comps below, and columns for sale price, price-per-square-foot, square-footage adjustment, condition adjustment, and final adjusted price. The last column should cluster in a narrow band — if adjusted prices range from $410,000 to $520,000 on the same subject, the comp selection is too loose. Ask the agent to explain why each comp was picked before you trust the average.
Method 3 — Licensed appraisal
A licensed appraiser physically inspects your home, verifies square footage against tax records, notes condition and upgrades, and files a Uniform Residential Appraisal Report using methodology governed by the Uniform Standards of Professional Appraisal Practice (USPAP). USPAP is maintained by The Appraisal Foundation and enforced through state licensing boards; the Appraisal Institute is the professional standards body. A single-family appraisal runs $300–$600 in most markets and takes one to two weeks.
You need a licensed appraisal when the number has to be legally defensible: a refinance (the lender orders it), an estate settlement, a divorce, a property tax appeal, a request to remove private mortgage insurance, or an FSBO sale where you want a firm floor. It is the only method that produces a number a court, the IRS, or a lender's underwriting file will accept without question.
Appraisal vs. AVM: why they diverge
An appraiser sees the kitchen renovated in 2023 but never permitted, because they inspect the interior. An AVM does not, because algorithms cannot walk through a front door. Divergence of 5–15% between the two methods on the same house is normal — how market value and appraised value diverge unpacks the mechanics. When the numbers matter for something legal or financial, the appraisal is the one that counts.
Method 4 — Cash offer as a market-tested price check
An AVM tells you a range. A CMA tells you a listing strategy. An appraisal tells you a defensible number. A cash offer tells you a price a buyer will actually pay, with no obligation to accept. That is a different category of answer, and it is why this method belongs on the list even if you are not planning to sell.
Opendoor calculates a cash offer using three inputs. First, a comparable-sales analysis of recent transactions in your neighborhood, reviewed by the pricing team rather than surfaced straight from the model (Opendoor Help Center). Second, a condition assessment: you submit self-guided photos through the Opendoor Key App or schedule an in-person walkthrough. Third, the offer factors in Opendoor's service charge, estimated repairs, and carrying costs — which is what makes it a binding price you can act on rather than a raw AVM output.
The trade-off, said plainly: this is a cash-buyer offer, not a market-maximizing list price. If your top priority is squeezing every last dollar and you have 60 to 90 days to run a full listing cycle, an agented sale will usually net more after commissions and carrying costs. If your priority is certainty, speed, and a real number you can put in a spreadsheet, the cash offer is the only method here that returns a binding figure. Which one matters depends on your timeline. For the full walkthrough of the request flow, see the sibling on how to find out what your home is worth.
How to use a cash offer as a price check even if you don't sell
Request the offer, take that number to two agents for CMAs, then compare. Agent CMAs sit at the top (higher, longer timeline, commissions, no certainty until an accepted offer); the cash offer sits at the bottom (immediate, binding, no commission, factored for repairs). The difference is the cost of certainty and speed. The offer arrives on the Opendoor dashboard, where you can review it, request a re-evaluation, or walk away — nothing about requesting it commits you to accept.
How to pick the right method for your situation
Match the method to the question you are actually trying to answer.
| Your situation | Best method | Why |
|---|---|---|
| Just curious or tracking equity | Average three AVMs | Free, ballpark, no commitment |
| Considering a refinance | AVM plus the lender's appraisal | AVM to sanity-check LTV before applying |
| Planning to list within 90 days | Two or three agent CMAs | Agents adjust for condition and set list strategy |
| Estate, divorce, tax appeal, PMI removal | Licensed appraisal | Only defensible method for legal or IRS contexts |
| Selling and want a real price to compare | Opendoor cash offer plus one agent CMA | Binding offer floor plus agent's list-price ceiling |
The last row is the pattern most seriously-considering-a-sale homeowners land on: a floor (what a buyer will pay today) and a ceiling (what an agent thinks you could list at) with roughly one week of effort. Everything in between is the trade between speed and top-line price.
Accuracy bands: what each method actually gets you
Two things to notice about the accuracy grid you saw at the top of this article. First, the "binding" cell for the cash offer is not claiming higher statistical accuracy than a licensed appraisal — an appraisal is the tighter number in most cases. What "binding" means is that the offer is a specific price a specific counterparty will pay, whereas every other row is a probability distribution. Second, the AVM band widens dramatically for off-market homes. If your house has not sold in the last few years, the tool has less to anchor on and the error compounds. The averaging move — three or four AVMs, mid-point taken — pulls the effective band down to roughly 2–5% on typical properties, which is why the sibling on how home value estimates work recommends it as a starting point rather than a single-tool lookup.
Disclosure
Opendoor is not available in all markets. Products, programs, and terms are subject to change without notice. This material is provided for informational purposes only and is not an offer, guarantee, or commitment to purchase. Contact Opendoor for current availability and offer terms in your market.
