Appraiser Opinions Trail Owner Estimates of Home Values By Just One Percent

  • December 13, 2016
• Quicken Loans’ National HPPI shows appraised values closer to meeting homeowners’ estimates in November
• Home values rose 0.42% in November and increased 5.28% year-over-year, according to the National HVI

DETROIT, December 13, 2016 – Homeowner perceptions were a mere 1 percent higher than appraiser opinions in November, according to Quicken Loans’ National Home Price Perception Index (HPPI). This marks the fifth consecutive month the gap between homeowner expectations and appraised values narrowed.

The National Quicken Loans Home Value Index (HVI) shows appraised values moved higher by 0.42 percent in November. The index continued consistent annual gains, increasing 5.28 percent since November 2015.

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Home Price Perception Index (HPPI)

Homeowners have made significant progress in understanding appraisers’ opinions of their home values in 2016. Nationally, home value expectations of individuals refinancing moved closer to the values given by appraisers as the year went on. The HPPI has been on a trend of narrowing the gap between homeowner estimates and appraiser opinions of home values since April. This trend continued in November when the National HPPI showed the average owner’s estimate of value just 1 percent lower than the appraiser’s opinion.

“The HPPI compares the perceived gap between the homeowner and the appraiser’s opinion of a home’s value and has provided an intriguing look into the psychographics of our housing market,” said Quicken Loans Chief Economist Bob Walters. “The most recent HPPI indicates homeowners and appraisers are closer to agreeing at the end of 2016 than they were at the start of the new year. It’s our hope that with this information the only surprises this holiday season are the ones wrapped under the tree.”

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Home Value Index (HVI)

Despite some monthly variations, appraisal values measured by the National HVI have been on the rise throughout 2016. Home values increased 5.54 percent since January. Staying in line with the trend, the average appraiser valuation rose 0.42 percent in November – up 5.28 percent year-over-year. The West continued to lead the country in home value growth, with a 7.32 percent annual increase.

“Home values pushed higher throughout 2016, largely driven by lack of supply in the hottest markets,” said Walters. “It’s yet to be seen if these increases will continue or wane as homebuilding grows, boosting inventory.”

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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 expects its total close loan volume to reach close to $320 billion of mortgage volume across all 50 states between 2013 and the end of 2016. 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 seven consecutive years, 2010 – 2016, and highest in customer satisfaction among all mortgage servicers the past three years, 2014 – 2016.

Quicken Loans was ranked No. 5 on FORTUNE magazine’s annual “100 Best Companies to Work For” list in 2016, and has been among the top-30 companies for the last 13 years. It has been recognized as one of Computerworld magazine’s ’100 Best Places to Work in IT’ the past 12 years, ranking No. 1 in 2016, 2015, 2014, 2013, 2007, 2006 and 2005. The company moved its headquarters to downtown Detroit in 2010, and now more than 10,000 of its 15,000 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.

Additional graphics are available below.

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