How Often Should You Look at Your Zestimate?

Stacks of coins in a growth real estate concept.

To hear the real estate portals tell it, you should track your home’s value on a weekly basis, and sign up for all their email reports so you know the local market inside-and-out. You can do it via Zillow, Redfin or Trulia.

If that sounds like a lot of busy work, that’s because it is. You’re tracking a theoretical value based on other comparable sales, without having any offers in hand or even the desire to sell your place.

A thought experiment: if you knew your home’s value went up $10,000 over the past month, as computed by an algorithm, would you sell? What if the estimated value of your home dropped by $4,000? Would that have any impact on your day-to-day life? The answer in both cases is probably no.

That’s not to say that having a rough estimate of your home’s value isn’t important. In some instances, it can be. But in most cases, checking your home’s value quarterly is plenty, and checking every year is usually totally fine.

Sometimes knowing your home’s value is important

You actually are considering selling. Yes, then looking at the Zestimate makes sense. But you’ll also want to consult with several real estate agents, to get their opinion on what your condo could sell for, as well as look at comparable recent sales within your building.

You’re considering taking out a home equity loan. You’re borrowing money based on how much of your condo you own. If the condo has gone up in value, you can borrow a larger amount. That’s worth knowing. An online estimate can be a good start, but you’ll need a formal appraisal to appease the bank.

Your property tax bill. The amount of your property taxes is based on the value of your home. While an online estimator likely has no standing with your local tax jurisdiction, it can tell you whether the assessor has properly valued your place. If not, you might use that information to do more research and ultimately file an appeal.

You have private mortgage insurance (PMI). If you put down less than 20 percent on your place, your bank usually requires you to carry PMI. That’s costing you extra money each month and in most cases you can stop paying it as soon as you have 20 percent equity in your home. If your home’s value shot up, you might have that right now. Knowing that means you can contact your bank, get a new appraisal and stop paying extra earlier than expected.

Sometimes checking value isn’t vital, but can still be useful

The market is changing substantially. You probably don’t need a valuation to tell you what’s up, but it can provide valuable confirmation about your neighborhood. Is it gentrifying? Or are values dropping, as you see more foreclosures? Knowing that can affect your long-term life plans.

You’re worried you might be underwater. Being underwater means you owe more on your home than it’s worth. That means you’d have to pay money to sell your place – getting an algorithm’s thoughts can tell you if you’re in danger of this. Usually this is only a problem during a major housing crash.

You want to tote up your net worth. Financial experts say it’s a good idea to assess your savings, debt, spending and assets about once a year. It’s a good way to review your financial goals and habits. Knowing how much your home is worth is part of that.

Relax and focus on long view!

There’s almost no situation where checking your home’s value every week – or even every month – will serve you well. Doing so might be fun and a little addictive, but like much online, it could also make you a bit neurotic or obsessive about it.

The situations where you really need an estimate – like when you’re ready to sell, or you want to tap your equity – you’ll also need a more formal estimate, done by an appraiser or a real estate agent.

So, check your home’s value every once in a while, just to keep tabs on it, but there’s really no reason to make it a habit.

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