The Quicken Loans HPPI represents the difference between appraisers’ and homeowners’ opinions of home values. The additional inventory could lead to more balanced prices, moving away from the spike in annual growth we have seen lately.” If they do so, it would open home options for first time home buyers entering the market. With interest rates remaining historically low, this could be the time for a homeowner to move on to the new construction home they had their eye on. “What’s clear is that the demand for housing is strong in much of the country. “As we get later into the spring and summer selling season there are less and less homes available for sale, driving prices higher,” Banfield said. However, all regions showed annual gains, ranging from 2.17 percent in the Northeast to a 6.12 percent increase in the West. The only region that didn’t show a monthly increase in appraisal values was the Northeast, with a 1.18 percent drop. Annual growth was even stronger with 5.35 percent year-over-year increases in value. According the National HVI, appraised values rose 1.25 percent from May. June was another month of strong home value growth. Either way, if owners are aware of their local markets it will lead to smoother mortgage transactions.” Home Value Index (HVI) On the other hand, if an appraisal comes in higher, they could be surprised with more equity than they had planned. “A homeowner could be forced to bring more cash to closing in order to make a mortgage work if the appraisal is lower than expected.
“While a 1 or 2 percent difference in home value opinions may not seem like a lot, it could be enough to derail a mortgage,” said Quicken Loans Executive Vice President of Capital Markets, Bill Banfield. On the flip side, the Western markets were more likely to have owners underestimate their home value. The Midwestern and Eastern regions kept with the national trend of a lower appraiser opinion. There is a wide range of perceptions across the country. This is compared to June when estimates were 1.93 percent higher. Nationally, appraisals were an average of 1.70 percent lower than what homeowners thought they would be, as measured by the HPPI. Owners are still estimating their homes at higher values than the appraisal, although the spread is now slightly narrower. Quicken Loans’ National Home Value Index (HVI) showed appraisals rose an average of 1.25 percent from May to June and increased 5.35 percent year-over-year. This marks the first time in seven months that the gap between the two opinions of value narrowed.ĭespite differing opinions in appraisals, home values continue to rise across the country. Home values rose 1.25% nationally in June, with a 5.35% year-over-year increase, according to the Quicken Loans HVIĭETROIT, J– Owners think their homes are worth an average of 1.70 percent more than appraisers do, according to Quicken Loans’ National Home Price Perception Index (HPPI).Quicken Loans’ National HPPI shows appraised values 1.70% lower than homeowners estimated in June.