>If a homeowner or homebuyer is paying someone to assess the value of a property, requiring expertise and training in inspection of a house such as materials, build quality, plumbing and whatnot, I could understand needing government approval.

I've seen how appraisers appraise, and this comment brought out a laugh.

Their estimate is really no better than Zillow's.

They spend about 15-20 minutes looking at the property. They primarily measure dimensions and look at cosmetic stuff (no "inspection" whatsoever). Then they look at comparables and make an appraisal.

I asked one of them how they handle various items in their appraisal (solar panels, etc). The answer? "I have no idea what to do with those things, so I just ignore them."

The reality is many buyers will value stuff that the appraiser just plain ignores. This causes problems because the seller cannot increase their price due to those items - when it comes time for the buyer to get a loan, the appraisal will come out lower than the sale price and the bank won't approve.

I recall when I bought my house, the real estate agent had access to the appraiser.

Lots and lots of problems with the appraisal business. I don't know how much they make, but it's a good racket to get into that requires minimal work and pays well ($400-800 per appraisal - they spend more time driving to houses than examining them).

I think you're assuming way more thoroughness in the typical assessment of a property than is warranted by the practices. At least with respect to real estate taxes, in my experience assessments are pretty mechanical with respect to square footage and standard house features (number of bathrooms, etc.)

Assessments are different from inspections.

I don't really disagree with you though. There would seem to be a difference between someone being directly paid to assess something, perhaps largely based on standard formulas and practices and a web company providing housing estimates with no contractual relationship.

The actual Illinois law covers real estate appraisal, not other kinds (ie, cars). However, it defines an appraisal as the act of forming an opinion about the value of a piece of real estate. It then forbids doing it without a license. Not doing it for money, not communicating your opinion, but forming it. There are explicit exceptions for realtors, banks involved in real estate lending, and for private use (ie, appaising your own house).

So I would say Zestimates are clearly illegal according to the plain text of the law. However, I suspect this is one of those laws where a judge would find a convoluted reading to support his or her gut opinion that finding Zestimates illegal is ridiculous. I think you could also make a pretty reasonable claim that the freedom to form an opinion about the value of something is an unenumerated, but nonetheless inalienable right, and therefore the law is unconstitutional.

Not a lawyer.

There are some rules around someone saying what a home is 'worth' when we were recently buying our house the realtor had a couple tools for estimating sale price but every email with them was extremely adamant that it was not an estimate of worth because that would require a full appraisal. Maybe she was being overly cautious but it was so constant I have to believe there were some very real restrictions she was working with.

So when you go to a company and ask for a bank loan secured against a car, or to insure your car against loss, you might want to have some common standards recognized by insurers or loan providers as to what constitutes a 'fair value'. You would be a bit upset if you filed an insurance claim on your car, and the underwriter came back and said 'I asked @lotsofpulp and they said your car is worth $25K instead of $30K'. You might question what credentials @lotsofpulp has to value cars.

Now, you might argue that there are market based or self-regulated solutions to that, and that's reasonable (fact is that a lot of the industry goes off 'de facto' standards for valuing cars, like KBB), but the fact is that sometimes a government regulation is necessary to prevent anticonsumer or anticompetitive practices, especially in the finance industry.

Yeah- also what if you make up a brand new word to ensure people see it's not an estimate. A Pulpstimate or something.

Or Zestimate, even.

This isn't the same thing. This would be you putting up a web site that tracks cars and the ones for sale you'd say how much you think it's worth. Do it once, you're just a guy (or gal) saying something. Do it all the time and you become somewhat of an authority figure. That's the difference.

But just because you're an authority figure, doesn't mean you have to be licensed.

I can have a website where I give financial advice. If I set up a business to give individual advice I may need some sort of certification.

A home appraisal is not the same thing as a home inspection, the latter being much more thorough,looking for condition of home mechanics, and structure.