Claims contest winners’ algorithm improves Zestimate accuracy
The Zestimate that appears on every listing on Zillow is about to get a little closer to the expected sales price of a house, and all the online real estate giant had to do is give away more than $1 million.
More than 18 months ago, Zillow launched a contest it called the “Zillow Prize.” The goal of the contest was to see if anyone could create an algorithm that could beat the one powering Zillow’s “Zestimate,” the online real estate giant’s property value estimation tool.
If anyone could beat Zillow’s benchmark model, they’d score themselves $1 million.
And Wednesday, Zillow announced that a team of amateurs succeeded in creating a model that bested the Zestimate.
According to Zillow, the winning team beat the Zillow benchmark model by approximately 13%. The winning team includes data scientists and engineers from around the world: Chahhou Mohamed of Morocco, Jordan Meyer of the United States, and Nima Shahbazi of Canada.
As a result of Mohamed, Meyer, and Shahbazi’s efforts to beat the Zestimate, the team will be awarded $1 million.
Beyond that, Zillow also awarded $100,000 to the second-place team, and $50,000 to the third-place team.
But Zillow is hardly chalking this exercise up as a loss. Just the opposite, in fact.
Zillow said that it will incorporate parts of the winning team’s model, along with other contest entries, to improve the accuracy of the Zestimate that appears on the listings for 110 million homes on Zillow.
According to Zillow, the improvements to the Zestimate will decrease its current nationwide error rate of 4.5% to less…