The Widening Gap Dividing Homeowner Expectations and Appraisal Values
Quicken Loans, the nation’s second largest retail mortgage lender, announced yesterday that in the month of February home appraisals were coming in lower than what homeowners expected.
The findings are in accordance with the company’s newest proprietary Home Price Perception Index (HPPI). The study compares what refinancing homeowners expect their home to be valued at in comparison to what it is actually appraised at.
The expectation of what the value of their house is among homeowners was an average of 1.99 percent higher than what the actual appraisal value came back at.
The previous five months, the trend was showing a narrowing gap between the two data points. February’s data, though a minimal increase, has brought a reversal to the trend, widening the gap for the first time in six months.
February marked a continuation of growth in home values, making up for the slight dip we saw in January. According to the Quicken Loans Home Value Index (HVI), appraised values increased an average of 1.51 percent nationally.
The HVI is currently the only measure of home values that is solely based on appraisals. The index has increased 3.89 percent in contrast to February 2015.
Have you experienced any problems with homeowners who may have thought they had more equity in their home?