Quicken Loans Report: Gap Between Appraiser and Homeowner Perceptions Doubled in July

- Home values remained largely unchanged since June, healthy growth since July 2014 -

- Homeowners valued their homes higher than appraisers for the sixth consecutive month.

- The annual rate of home appreciation was highest in the West and lowest in the Northeast.

Aug 11, 2015, 10:05 ET from Quicken Loans

DETROIT, Aug. 11, 2015 /PRNewswire/ -- Quicken Loans, the nation's second largest retail mortgage lender, today reported appraiser opinions of home values were 2.33 percent lower than homeowner estimates in July, according to the company's national Home Price Perception Index (HPPI). The gap between homeowner estimates and appraiser opinions of value in July was nearly double the gap between these values in May.

Quicken Loans' Home Value Index (HVI), the only measure of home values based exclusively on actual home appraisals, reported national housing values were nearly flat, with a 0.27 percent drop in value. The index showed a 3.89 percent value growth nationally since July 2014.

Home Price Perception Index (HPPI)

Homeowners are increasingly overvaluing their homes, according to the national HPPI. The study showed appraisers' opinions of home values was, on average, 2.33 percent lower than homeowners' estimates in July. Last month's gap was nearly double the difference between opinions in June when appraisers' opinions were 1.40 percent less than homeowners' estimates.

"Many homeowners around the country are seeing the national headlines about home value increases and they are optimistic about their equity increasing," said Quicken Loans Chief Economist Bob Walters. "While some areas are seeing the same level of home appreciation, or even more, there are also some areas that have slower home value increases. This can lead to homeowners and appraisers not quite seeing eye-to-eye."

Home Value Index (HVI)

Home values across the nation continue to rise above last year's levels, although they are practically flat on a monthly basis. The HVI reported national values decreased 0.27 percent from June to July, but increased 3.89 since last July.

"A slowing of home value increases adds to the misunderstanding of local home values," Walters continued. "Appraisers are viewing the housing industry every day; they know when home values growth may be slowing. Homeowners may think values are still skyrocketing, when they have instead returned to more healthy appreciation in their area."


HVI
July 2015

 

January 2005 = 100

HVI

July 2015

vs.

June 2015

% Change

HVI

July 2015

vs.

July 2014

% Change

HPPI

July 2015

 

Appraiser Value
vs. Homeowner
Perception of
Value*

HPPI

July 2014

 

Appraiser Value
vs. Homeowner
Perception of
Value*

National
Composite

93.74

-0.27%

+3.89%

-2.33%

+1.98%

*A positive value represents appraiser opinions that are higher than homeowner perceptions. A negative value represents appraiser opinions that are lower than homeowner perceptions.

 

Geographic

Regions

 

HVI

July 2015

 

January 2005 = 100

HVI

July 2015

vs.

June 2015

% Change

HVI

July 2015

vs.

July 2014

% Change

HPPI

July 2015

 

Appraiser Value
vs. Homeowner
Perception of
Value*

HPPI

July 2014

 

Appraiser Value
vs. Homeowner
Perception of
Value*

West

111.21

+0.07%

+6.30%

-2.04%

+4.38%

South

95.54

+0.00%

+3.34%

-2.30%

+2.74%

Northeast

92.27

-0.60%

+0.87%

-2.50%

-0.57%

Midwest

78.16

-0.69%

+1.20%

-2.55%

+0.01%

*A positive value represents appraiser opinions that are higher than homeowner perceptions. A negative value represents appraiser opinions that are lower than homeowner perceptions.

 

Metropolitan

Areas

HPPI

July 2015

 

Appraiser Value
vs. Homeowner
Perception of
Value*

HPPI

June 2015

 

Appraiser Value
vs. Homeowner
Perception of
Value*

HPPI

July 2014

 

Appraiser Value
vs. Homeowner
Perception of
Value*

San Jose, CA

+5.96%

+6.11%

+4.41%

San Francisco, CA

+5.35%

+5.39%

+5.71%

Denver, CO

+4.21%

+4.22%

+3.98%

Houston, TX

+3.24%

+3.37%

+3.72%

Dallas, TX

+2.76%

+2.85%

+3.45%

Portland, OR

+2.30%

+2.28%

+2.63%

Los Angeles, CA

+1.94%

+2.44%

+5.16%

Boston, MA

+1.63%

+1.78%

+1.91%

Sacramento, CA

+1.35%

+1.73%

+4.88%

Riverside, CA

+1.32%

+1.36%

+2.00%

Las Vegas, NV

+0.83%

+1.23%

+5.47%

Washington, D.C.

+0.80%

+1.10%

+2.25%

Seattle, WA

+0.66%

+1.13%

+3.54%

Miami, FL

+0.56%

+0.75%

+3.80%

Detroit, MI

+0.07%

+0.59%

+2.53%

Minneapolis, MN

-0.02%

-0.04%

+3.05%

San Diego, CA

-0.16%

-0.22%

+4.45%

Phoenix, AZ

-0.24%

-0.08%

+3.68%

Tampa, FL

-0.64%

-0.42%

+2.99%

Atlanta, GA

-0.93%

-0.89%

+2.85%

New York, NY

-0.96%

-0.90%

-0.37%

Baltimore, MD

-1.17%

-0.87%

+0.04%

Cleveland, OH

-1.36%

-1.26%

-2.25%

Chicago, IL

-2.04%

-1.45%

-0.91%

Charlotte, NC

-2.15%

-2.02%

-0.13%

Kansas City, MO

-2.69%

-3.19%

-0.81%

Philadelphia, PA

-3.03%

-2.83%

-3.47%


*A positive value represents appraiser opinions that are higher than homeowner perceptions. A negative value represents appraiser opinions that are lower than homeowner perceptions.

About the HPPI & HVI

The Quicken Loans HPPI represents the difference between appraisers' and homeowners' opinions of home values. The index compares the estimate that the homeowner supplies on the mortgage application to the appraisal that is performed later in the mortgage process. This is an unprecedented report that gives a never-before-seen analysis of how homeowners are viewing the housing market. The HPPI national composite is determined by analyzing appraisal and homeowner estimates throughout the entire country, including data points from both inside and outside the metro areas specifically called out in the above report.

The Quicken Loans HVI is a view of home value trends based solely on appraisal data from home purchases and mortgage refinances. This produces a wide data set and is focused on appraisals, one of the most important pieces of information to the mortgage process.

Both of these reports are created with Quicken Loans' propriety mortgage data from the 50-state lenders' mortgage activity across all 3,000+ counties. The indexes are examined nationally, in four geographic regions and the HPPI is reported for 27 major metropolitan areas. All indexes, along with downloadable tables and graphs can be found at QuickenLoans.com/Indexes.

About Quicken Loans

Detroit-based Quicken Loans Inc. is the nation's second largest retail home mortgage lender. The company closed $140 billion of mortgage volume across all 50 states in 2013-2014. Quicken Loans generates loan production from web centers located in Detroit, Cleveland and Scottsdale, Arizona. The company also operates a centralized loan processing facility in Detroit, as well as its San Diego-based One Reverse Mortgage unit. Quicken Loans ranked "Highest in Customer Satisfaction for Primary Mortgage Origination" in the United States by J.D. Power for the past five consecutive years, 2010 - 2014, and highest in customer satisfaction among all mortgage servicers in 2014.

Quicken Loans was named among the top-30 companies on FORTUNE magazine's annual "100 Best Companies to Work For" list for the last 12 consecutive years, ranking No. 12 in 2015. It has been recognized as one of Computerworld magazine's '100 Best Places to Work in IT' the past ten years, ranking No. 1 in 2014, 2013, 2007, 2006 and 2005. The company moved its headquarters to downtown Detroit in 2010, and now more than 10,000 of its nearly 12,000 team members work in the city's urban core. For more information about Quicken Loans, please visit QuickenLoans.com, on Twitter at @QLnews, and on Facebook at Facebook.com/QuickenLoans.

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SOURCE Quicken Loans