Appraiser and Homeowner Home Valuation Opinions Continue to Widen









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Home values rise in majority of metros

Appraiser and homeowner home valuation perception continues to widen in more than two dozen major metro areas. Quicken Loans’ national Home Price Perception Index (HPPI) reported that the difference between homeowner opinions of their home valuations and appraiser valuation opinions, increased for the fourth consecutive month in May. Home values came in 1.15 percent lower than what homeowners opined, the first time in nearly two years, according to the HPPI.

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“The HPPI, more than anything, is a reminder that there is no such thing as a national housing market,” said Bob Walters, Quicken Loans chief economist. “Every city, and every neighborhood, moves in different directions based on local factors. Consumers need to remember to watch their local area closely to understand the direction their market is heading.”

The HPPI represents the difference between appraiser and homeowner home value opinions. It compares the estimate which is provided by the homeowner on the mortgage application to the appraisal performed later in the mortgage application process. The reports are created with the propriety mortgage data from Quicken Loans and is culled from mortgage activity from all 3,000 plus counties across 50 states. The indexes are broken down into four geographic regions and includes 27 major metropolitan areas.

The HPPI found that home values steadily climbed in most regions of the country. The national Home Value Index (HVI) rose 0.24 percent in May from its April level and increased 4.64 percent from May 2014. In April, valuations opinions were 0.69 percent lower than what homeowners estimated, but despite this, appraiser valuation opinions remain higher in the majority of the metro areas studied.

In the Northeast, appraiser valuations came in 0.58 percent lower than homeowner opinions of value, 0.70 lower in the South, 1.23 lower in the Midwest and appraisers in the West came in 0.08 percent higher than homeowner opinions.

Metro areas saw bigger differences: San Jose appraiser valuation opinions came in 6.73 percent higher than homeowner opinions, Denver had 4.09 percent difference and San Francisco appraiser opinions clocked in at 5.47 percent higher than homeowners.

On the other side, Kansas City, Missouri homeowners overestimated the value of their homes 2.96 percent higher than what appraisers did, the highest of the examined metro areas in the country. Philadelphia homeowners opined their homes were valued 2.02 percent higher and homeowners in Charlotte felt their homes were valued 1.4 percent higher.

“While smaller monthly increases and a slowing of the annual growth may sound discouraging, it is precisely the measured, healthy growth that is needed to embolden homebuyers and create a sustainable housing market,” explained Walters. “A more balanced market between buyers and sellers almost always leads to continued steady home value increases.”



MReport. Home Value Opinion Gap Widens Between Appraisers and Homeowners, According to Index

National Association of REALTORS. Owners, Appraisers Disagree on Home Values

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