Gap Between Owner and Appraiser Opinions of Home Values Narrows for Fourth Straight Month
-- Quicken Loans' National HPPI shows appraised values 1.14% lower than homeowners estimated in September
-- Home values rose 0.44% nationally in September, with a 3.38% year-over-year increase, according to the Quicken Loans HVI
DETROIT, Oct. 10, 2017 /PRNewswire/ -- Homeowners still don't see eye-to-eye with those who appraise their homes. Appraiser's valuations were 1.14 percent lower, in September, than what owner's expected – according to the National Quicken Loans Home Price Perception Index (HPPI).
Even though home values may not have risen to the level owners expected, they kept rising. Quicken Loans' Home Value Index (HVI), the only measure of home value change based solely on appraisal data, showed home values increased 0.44 percent from August to September, and jumped 3.38 percent since September 2016.
Home Price Perception Index (HPPI)
There was an average of 1.14 percent difference between the appraisal and the homeowner's estimate of value in September – with the appraiser's opinion falling below that of the homeowner. However, the trend is positive. September was the fourth consecutive month the gap between the two perceptions narrowed, as perceptions moved closer to equilibrium. On the other hand, there is still a wide variety of home value perceptions across the country. From Dallas, where appraisals are an average of 2.87 percent higher than expected, to Philadelphia, where the average appraisal is 2.89 percent lower than what the owner thought it would be.
"An appraisal can vastly impact the mortgage process. This number alone can impact how much a buyer needs to bring to closing, or the current equity a homeowner has when refinancing," said Bill Banfield, Quicken Loans Executive Vice President of Capital Markets. "If homeowners are aware of local home values and how they are changing, it will assist with a smoother mortgage process."
Home Value Index (HVI)
Home values continued their ascent in September. On a national level, appraisals rose 0.44 percent from the previous month. Even more impactful, the average home valuation was 3.38 percent higher than the same time last year. Regionally, all areas showed annual home value growth, from 2.08 percent in the South to 5.77 percent in the West. Monthly, however, the South did have a 1.33 percent drop in September.
"Home values are highly impacted by the balance of buyer's interest and the volume of available homes. Currently this is highly tilted, with a lack of home inventory – leading to rising values," said Banfield. "One of the most impactful things that could be done to achieve stability is an increase in new home building. If move-up buyers move on to new construction, it will open up starter homes for first time buyers."
| HVI September 2017
January 2005 = 100 |
HVI September 2017 vs. August 2017 % Change |
HVI September 2017 vs. September 2016 % Change |
HPPI September 2017
Appraiser Value |
HPPI September 2016
Appraiser Value |
|
| National Composite |
104.44 |
+0.44% |
+3.38% |
-1.14% |
-1.26% |
*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 September 2017
January 2005 = 100 |
HVI September 2017 vs. August 2017 % Change |
HVI September 2017 vs. September 2016 % Change |
HPPI September 2017
Appraiser Value |
HPPI September 2016
Appraiser Value |
| West |
128.09 |
+0.98% |
+5.77% |
-0.93% |
-0.73% |
| South |
103.98 |
-1.33% |
+2.08% |
-1.14% |
-0.91% |
| Northeast |
98.68 |
+0.91% |
+2.71% |
-1.21% |
-1.50% |
| Midwest |
87.25 |
+0.66% |
+5.64% |
-1.31% |
-1.45% |
*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 September 2017
Appraiser Value |
HPPI August 2017
Appraiser Value |
HPPI September 2016
Appraiser Value |
| Dallas, TX |
+2.87% |
+2.90% |
+1.85% |
| Denver, CO |
+2.52% |
+2.66% |
+3.14% |
| Seattle, WA |
+2.12% |
+2.17% |
+1.12% |
| San Jose, CA |
+1.73% |
+1.55% |
+2.11% |
| San Francisco, CA |
+1.63% |
+1.36% |
+2.34% |
| Portland, OR |
+1.58% |
+1.34% |
+1.84% |
| Boston, MA |
+1.07% |
+0.89% |
+0.59% |
| Charlotte, NC |
+1.05% |
+1.08% |
-0.18% |
| San Diego, CA |
+0.94% |
+0.76% |
+0.47% |
| Los Angeles, CA |
+0.86% |
+0.86% |
+1.39% |
| Sacramento, CA |
+0.72% |
+0.61% |
+0.88% |
| Miami, FL |
+0.64% |
+0.57% |
-0.22% |
| Phoenix, AZ |
+0.35% |
+0.36% |
-0.72% |
| Minneapolis, MN |
+0.32% |
+0.32% |
+0.33% |
| Kansas City, MO |
+0.25% |
+0.29% |
-0.49% |
| Las Vegas, NV |
+0.09% |
+0.07% |
-0.75% |
| Riverside, CA |
+0.03% |
+0.08% |
+0.23% |
| Houston, TX |
-0.11% |
-0.05% |
+0.97% |
| Detroit, MI |
-0.30% |
-0.37% |
-2.99% |
| Tampa, FL |
-0.30% |
-0.51% |
-1.81% |
| Washington, D.C. |
-0.66% |
-0.83% |
-0.14% |
| Atlanta, GA |
-0.70% |
-0.93% |
-0.69% |
| New York, NY |
-1.16% |
-1.46% |
-1.31% |
| Chicago, IL |
-2.15% |
-2.36% |
-2.08% |
| Cleveland, OH |
-2.24% |
-2.33% |
-1.95% |
| Baltimore, MD |
-2.68% |
-2.82% |
-2.68% |
| Philadelphia, PA |
-2.89% |
-3.05% |
-3.03% |
*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 a refinance 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 the only 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.
The HPPI and HVI are released on the second Tuesday of every month. Both of the 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 more than $300 billion of mortgage volume across all 50 states between 2013 and 2016. Quicken Loans moved its headquarters to downtown Detroit in 2010, and now more than 17,000 team members from Quicken Loans and its Family of Companies work in the city's urban core. The company 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 seven consecutive years, 2010 – 2017, and highest in customer satisfaction among all mortgage servicers the past four years, 2014 – 2017.
Quicken Loans was ranked #10 on FORTUNE magazine's annual "100 Best Companies to Work For" list in 2017, and has been among the top-30 companies for the past 14 consecutive years. The company has been recognized as one of Computerworld magazine's '100 Best Places to Work in IT' the past 13 years, ranking #1 for eight of the past twelve years including 2017. The company is a wholly-owned subsidiary of Rock Holdings, Inc., the parent company of several FinTech and related businesses. Quicken Loans is also the flagship business of Dan Gilbert's Family of Companies comprising nearly 100 affiliated businesses spanning multiple industries. For more information and company news visit QuickenLoans.com/press-room.
Twitter: @QLnews
SOURCE Quicken Loans
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