The estimate
Automated estimates are models, not valuations. Knowing how they are built tells you when to trust the number, when to ignore it, and what it is actually good for.
The model
An automated valuation model takes what is publicly recorded about your property, finds recent sales of properties it considers comparable, and adjusts for the differences. Land size, dwelling type, bedrooms and bathrooms, and the trend in your specific suburb all feed in. The output is a single figure, usually with a confidence indicator that most people never look at.
Two things follow from that. First, the estimate is only as good as the comparable sales available, so a quiet street in a quiet month produces a weaker estimate than a busy one. Second, the model can only see what has been recorded. Everything you have done to the property since it last changed hands is invisible until it sells again.
The spread
Each provider runs a different model over a different snapshot of the market. They weight comparables differently, they receive sales data at different times, and they make different assumptions about how fast a suburb is moving. Cotality publishes its Home Value Index monthly across Australian dwellings, and it is one input among several that these models draw on.1
So a spread between providers is expected. What matters is not which number is right, because none of them is a valuation, but whether they agree on direction. Three estimates that all moved up 6% over a year tell you something real even if they disagree by $60,000 on the level.
1 Cotality, Home Value Index, July 2026 release, released 1 July 2026, reporting June 2026 data.
The three ways
They cost different amounts, they take different lengths of time, and only one of them is binding. Choosing the wrong one for the question you are asking is the most common mistake here.
If you are asking whether to bother calling your lender, the automated estimate is enough and it is free. If you are preparing to sell, the appraisal is the one that reflects the property as it exists today. If you are refinancing or asking to be repriced, only the formal valuation counts, and it is worth knowing that a valuation coming in below expectations is the single most common way a plan that looked comfortable ends up above 80%.
What it is for
Not for deciding your asking price, and not for anything a lender will act on. Lenders order their own valuation and lend against that. The estimate is good for exactly one thing, and it is a valuable one: telling you when a conversation is worth having.
Your loan to value ratio has your property's value as its denominator. Lenders mortgage insurance is generally payable when the amount borrowed exceeds 80% of the value of the property,2 and the sharper pricing tiers sit below that same line. If a rise in your area's values has quietly taken you from 84% to 78%, you are entitled to ask your lender to revalue and reprice, and nobody is going to tell you that has happened.
That is the whole use case. The estimate is a trigger, not an answer. It tells you when to ask for the valuation that counts.
2 Moneysmart (ASIC), lenders mortgage insurance (LMI), glossary, retrieved 28 July 2026.
Over time
Checking once tells you very little, because you cannot tell a model's error from a real movement with a single reading. Checking the same address with the same provider over time is different: the errors are broadly consistent, so the changes between readings are meaningful even when the levels are not.
This is the part that is genuinely tedious to do by hand, and the part that decides whether the estimate is ever useful. The moment worth catching is a crossing, and crossings only exist in a series. Ratey tracks the value alongside your balance and re-runs your home loan health check every month, so the crossing arrives as a notification rather than as something you had to remember to look for.
Questions
Because each one runs its own model over its own data. Automated valuation models weigh recent comparable sales, land size, dwelling attributes and suburb trends differently, and they do not all see the same sales at the same time. A spread of five to ten per cent between providers on the same address is ordinary, not a sign that one is broken.
No. Lenders order their own valuation, either a full inspection or a desktop assessment from a panel valuer, and lend against that figure. An online estimate is useful for knowing roughly where you stand and for deciding whether asking for a revaluation is worth it. It carries no weight in a credit decision.
Most accurate for ordinary houses in dense suburbs with plenty of recent comparable sales. Least accurate for anything unusual: acreage, heritage, waterfront, heavily renovated homes, or apartments in small blocks. If your property is unusual in any way, treat the estimate as a wide range rather than a number.
Usually not, and this is the most common reason an estimate reads low. Automated models work from recorded attributes and sales, so a new kitchen, a second bathroom or a rebuilt extension is invisible to them until the property sells. If you have spent significantly on the place, expect the model to be behind.
Often enough to catch the crossings that matter, which in practice means a few times a year rather than daily. The figure only becomes actionable when it changes your loan to value ratio enough to move you into a better pricing tier or to make refinancing viable. Watching it more closely than that is entertainment.
Sources
Market figures are point in time published figures, checked each time this page is reviewed.
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Ratey
Working it out once tells you where you stand today. It moves as your balance falls and the market shifts, and the moments worth acting on are easy to miss. Ratey re-runs your free home loan health check every month against more than 35 Australian lenders, tracks your property value, equity and LVR, and tells you when something is worth doing.
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