Chasm Developing Between Homeowner, Appraiser Home Value Opinions in June

- Home values post slight increase for third straight month -

- June marks the fifth consecutive month that homeowners valued their homes higher than appraisers.

- Home values in the South region have slipped slightly, all other regions continue to see slight gains.

Jul 14, 2015, 11:09 ET from Quicken Loans

DETROIT, July 14, 2015 /PRNewswire/ -- Detroit-based Quicken Loans, the nation's second largest retail mortgage lender, today reported that appraiser home value opinions fell further below homeowner estimates in June. This is the fifth consecutive month of this trend at the national level. Appraiser opinions of home values were 1.4 percent lower than homeowner estimates, according to Quicken Loans' monthly national Home Price Perception Index (HPPI).

Quicken Loans' national Home Value Index (HVI) reported a slight increase of 0.74 percent in June, with home values increasing in all regions of the country except for the South, which posted a decline of 0.09 percent. National home values are up 4.38 percent from the year prior.

Home Price Perception Index (HPPI)

June marks the fifth consecutive month appraisers have estimated home values below homeowner estimates. During this five-month period, the gap between homeowner and appraiser estimates has increased each month, with an average 1.4 percent difference in June.                

"Over the last five months we've seen homeowners continually value their homes higher than appraisers," said Bob Walters, Quicken Loans Chief Economist. "While each local market has a different story to tell, a large part of this perception gap is likely due to the normalization of home prices. After about a year of home values trending upward, it takes some time for many homeowners to realize home values are stabilizing in their neighborhoods."

Home Value Index (HVI)

Home values inched higher in June, increasing 0.74 percent from the month prior. Yearly growth has slowed slightly from the annual level of the previous month, but still posted a 4.38 percent annual increase. The South was the only region to post a monthly decrease in home values, dropping by 0.09 percent.

"Home prices seem to be a bit frozen for the time being – validating that we are in a market that is well into the stabilization cycle," said Walters. "The real test for home price solidity will be when inventory increases to a level of equilibrium between supply and demand." 


HVI

June 2015

 

January 2005 =
100

HVI

June 2015

vs.

May 2015

% Change

HVI

June 2015

vs.

June 2014

% Change

HPPI

June 2015

 

Appraiser Value
vs. Homeowner

Perception of
Value*

HPPI

June 2014

 

Appraiser Value
vs. Homeowner
Perception of
Value*

National
Composite

93.3

0.74%

4.38%

-1.40%

2.07%

*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

June 2015

 

January 2005 =
100

HVI

June 2015

vs.

May 2015

% Change

HVI

June 2015

vs.

June 2014

% Change

HPPI

June 2015

 

Appraiser Value
vs. Homeowner
Perception of
Value*

HPPI

June 2014

 

Appraiser Value
vs. Homeowner
Perception of
Value*

West

109.16

+1.80%

+7.63%

0.00%

+4.74%

South

95.63

-0.09%

+3.22%

-0.24%

+2.84%

Northeast

92.71

+0.13%

+1.40%

-0.27%

-0.67%

Midwest

78.05

+0.83%

+1.35%

-2.14%

-0.08%

*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

June 2015

 

Appraiser Value
vs. Homeowner
Perception of
Value*

HPPI

May 2015

 

Appraiser Value
vs. Homeowner
Perception of
Value*

HPPI

June 2014

 

Appraiser Value
vs. Homeowner
Perception of
Value*

San Jose, CA

+6.11%

+6.38%

+4.60%

San Francisco, CA

+5.39%

+5.49%

+5.55%

Denver, CO

+4.22%

+4.15%

+4.07%

Houston, TX

+3.37%

+3.47%

+3.52%

Dallas, TX

+2.85%

+3.38%

+3.89%

Los Angeles, CA

+2.44%

+2.87%

+5.45%

Portland, OR

+2.28%

+2.61%

+2.19%

Boston, MA

+1.78%

+2.02%

+1.75%

Sacramento, CA

+1.73%

+2.02%

+6.12%

Riverside, CA

+1.36%

+1.47%

+3.61%

Las Vegas, NV

+1.23%

+1.50%

+5.80%

Seattle, WA

+1.13%

+1.63%

+3.39%

Washington, D.C.

+1.10%

+1.28%

+2.19%

Miami, FL

+0.75%

+0.92%

+4.15%

Detroit, MI

+0.59%

+0.95%

+2.38%

Minneapolis, MN

-0.04%

+0.27%

+2.75%

Phoenix, AZ

-0.08%

+0.45%

+4.08%

San Diego, CA

-0.22%

-0.19%

+5.34%

Tampa, FL

-0.42%

-0.28%

+3.04%

Baltimore, MD

-0.87%

-0.79%

-0.66%

Atlanta, GA

-0.89%

-0.84%

+3.05%

New York, NY

-0.90%

-0.65%

-0.42%

Cleveland, OH

-1.26%

-1.33%

-2.28%

Chicago, IL

-1.45%

-0.82%

-0.94%

Charlotte, NC

-2.02%

-2.11%

+0.81%

Philadelphia, PA

-2.83%

-2.43%

-3.68%

Kansas City, MO

-3.19%

-3.24%

-0.97%

*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.

Photo - http://photos.prnewswire.com/prnh/20150714/236264-INFO

 

SOURCE Quicken Loans



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