Zillow newest addition to booming real estate space

If you’re a homeowner in the crazed Bay Area real estate market, chances you’re at least a little obsessed with the value of your home. Which means you might find it hard to resist Zillow.com, at least once anyway. After a fair bit of anticipation, the Seattle start-up came out of stealth tonight. It’s aim is to help people value homes.

Type in an address, and Zillow’s algorithm crunches the home sales, tax assesor and other data it has and returns what it calls a Zestimate. We tried it on our home and it didn’t seem far off. The site also shows the values of surrounding homes, which are displayed on an aerial map. Zillow can also show “comps,” or the sale prices of homes that are comparable to the one your interested in.

Zillow obviously can’t match a home’s value exactly every time. So it offers a page that rates its accuracy for different areas.

“I’ve been jumping up and down about online real estate for a long-time,” said Richard Barton, Zillow’s CEO. “A lot of information, people should be able to get themselves. We were kind of surprised when we dug in and saw what’s available.”

Barton said focus groups showed that people want to know what houses are worth, “and that there weren’t any good tools to track this….Our goal is to give a birds-eye view of any market.”

Zillow’s been on a lot of people’s radar for a couple of reasons: The online real estate space is suddenly hot (see here and here). And Zillow’s launching big, with 75 employees and $32 million in backing from two venture-capital firms, Benchmark Capital and Technology Crossover Ventures. Barton himself is a notable Internet name, having founded the Expedia travel site, later sold to IAC/InterActiveCorp.

It’s also worth noting that Barton is a venture partner at Benchmark, and spends a fair amount of time down here in the Bay Area. He’s also on the board of NetFlix and AtomShockwave.

So what’s the business model? Advertising. Zillow is banking on being able to sell highly targeted advertising to the industry and anyone else who wants to be in front of homebuyers and sellers.

With 75 employees and a $32 million investment, Zillow is going to have to sell a lot of advertising. But the site has national coverage, which could translate into lots of page views.

“The great thing about Web 2.0 is that if you can attract an audience, advertising works,” he said.

UPDATE: The Seattle PI has a lengthy write-up here. And smaller start-up PropertyShark.com debuts and zings Zillow.

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