My home hit the market today. It used to be that a real estate broker would pull a magic number out of the air and that was the price you offered your home at. The broker might have mentioned recent sale prices of homes in the neighborhood, but your agreeement was generally based on faith in your broker.

Online real estate tools launched earlier this year by Benchmark-backed Zillow and Idealab-based RealestateABC.com have evened the playing field. Now, anyone can check the comps in their neighborhood. So, when my broker suggested what I thought was an insultingly low figure at which to offer my house, I went online. Here is the resulting e-mail I fired off to my broker late that night:

Hi,

After we got off the phone today, I did a little research.

According to this page at http://www.realestateabc.com/home-values/CA/, at the asking price you suggested we offer the house at, our house would be valued at $530 per square foot.

However, none of the 10 homes that have sold in this neighborhood sold for that low a square foot to dollar ratio since December 2004. That one case was 100 xxx, which looked like a shady deal to us at the time. Excluding that deal, we would have to go back to September 2003 to find a home in the neighborhood that for sold for less than $530 per square foot.

In fact since November 2003, of the 18 sales in the neighborhood at large, the cheapest dollar per square foot that has sold (aside from 100 xxx) was $545 per square foot. For our house, that ratio calculates out to an asking price of a decent amount more than your suggestion. The second cheapest was $558, which calculates out to an even nicer percentage increase for the asking price of our home.

Now I’m not saying our house is in the best shape, but it’s decent. It must be in average condition for a neighborhood where at least some of the sellers are original owners going back to the 50s or 60s. So, I wonder why we’re getting such a low price considering the size of our house? In other words, I’d like to find out why we seem to be offering this house at a price per square foot that seems to have been the prevailing ratio in 2003 rather than the one in 2006?

Josh

The next day, we decided to accept the recommended asking price of our broker in order to recognize a cooling market and to create interest in the home, which we hope could drive the price higher. But, the help of the online valuation tools means the offering price is not a magic number to me. It's a figure I feel comfortable with based on hard data accessible on the web.

I will continue providing ongoing updates to my use of online real estate tools as my home selling process progresses. I'm hoping this experience will help venture capitalists get a better understanding of how new technology is affecting the $60 billion real estate market and whether current startups are addressing users' needs.

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