Real estate pricing websites can't be perfectly accurate

Q. How reliable are websites such as Zillow and others that list an estimated value of my home? I purchased my home in 2013, which was new construction for $185,000. It was assessed at $186,000. On websites, they say my home is worth about $160,000. I do not plan to sell my home soon but am interested in knowing, just for fun.

A. I'm sure there have been studies about the reliability of websites like Zillow and Trulia, but I've never run into them. Your question intrigued me, so I looked up my own address - first time I've ever done that. One site estimated the property about 15 percent less than I think it's worth, the other at 5 percent less.

Perhaps, like many homeowners, I have exaggerated ideas about the value of my own home, though I'm not convinced. I know what recent sales on the street have brought.

The value of newly built property is usually considered to be what you paid for it. Beyond that, good estimates can come from experienced brokers who are familiar with your neighborhood. Those opinions are usually free and freely given.

Of course professional appraisers (certified or licensed) always caution, "If it's free, it's not an appraisal." Their detailed, written reports - the kind mortgage lenders rely on - are certainly way ahead of the computer-generated figures on websites. (I've been told by appraisers that 5 percent either way is considered about as accurate as they expect to get.)

The only way to know for sure about price, of course, is to test it widely on the open market. The whole matter can be summed up in three words:

"Buyers determine value."

Q. We have a question regarding sale of our home and would like whatever information you have for us. After many years here in the North, we find we no longer tolerate the cold weather well. We have an older home that needs some cosmetic repairs that we cannot afford. What is the best approach to facilitate the sale? The second part of the question involves short-term rental (up to six months) of a handicapped residence each year when we return home for the summer.

A. For the first part of your question, the answer is simple. Look at for-sale signs in and around your neighborhood, take the phone numbers, and call three different real estate companies. Ask them to send someone over to look at your property and give you advice about how to sell. It won't obligate you at all. Agents who see your property can judge better than I can over the Internet.

As for rentals when you come back each summer - I'm afraid I have no special advice there. You might contact a nearby senior center to see if they have any suggestions about where to find information.

Q. My uncle left his home in trust to a son, who wants to sell it. The deed is in the trust's name. As trustee, who do I transfer the deed to at the sale?

A. You need professional help in preparing documents and handling the whole procedure. By all means, contact a lawyer. The trust should bear the expense.

Q. My daughter is buying a house. Her father and I want to loan her the money. He is 83; I am 75. We will live with her when we can no longer live independently. Do we have to charge her interest? We do not want to do so. If that is not legally possible what is the least amount we must charge?

A. If you intend to hold a mortgage on your daughter's house, you must charge at least the "applicable federal rate" in interest. That figure is a bit smaller than average current mortgage rates. It varies depending on how long the mortgage will run, and the government sets the exact rates every month. (Federal law does, however, let each of you make a gift to your daughter of up to $14,000 every year with no gift tax or report due, so you could probably even things up that way.)

Do get professional help in drawing up the mortgage documents and having them entered in the public records. And ask for information about income tax consequences for you and for your daughter.

• Edith Lank will respond to questions sent to her at 240 Hemingway Drive, Rochester, N.Y. 14620 (include a stamped return envelope), or readers may email her through askedith.com.

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