Value Perceptions
Owner perceptions of home value improve for third straight month
Homeowners' expectations of their property's value continued to be closely in tune with the figure determined by an appraiser, according to the retail mortgage lender Quicken Loans.
In the latest update of its Home Price Perception Index, Quicken Loans found that the average appraisal in July fell 0.63 percent lower than an owner's estimate. This was the third consecutive month where the gap between appraised and estimated values narrowed, an improvement from 0.71 percent in June but a wider separation than the 0.28 percent figure recorded in July 2018.
"As expected, with mortgage rates at three-year lows and the refinance share of mortgage activity continuing to hover about 50 percent, homeowners are increasingly aware of the true value of their home," said Bill Banfield, executive vice president of capital markets at Quicken Loans. "Prices continue to increase in most areas but the rapid growth of years past has moderated, giving homeowners a better sense of their home's market value."
The gap between appraised and expected values was greatest in the Midwest and Northeast, with the average appraisal falling 0.69 percent short of expectations in the former region and 0.67 percent lower in the latter. The average appraisal was 0.63 percent less than expected in the South and 0.52 percent lower in the West.
In the 27 major metropolitan areas included in Quicken Loans' analysis, appraisals were greater than expected in 11 cities and less than expected in 16. Homeowners were most likely to be pleasantly surprised in Charlotte, N.C., where the typical appraisal was 1.92 percent higher than expected. Typical appraisals were 1.29 percent above estimates in Minneapolis and 0.9 percent higher in Boston. On the other end of the spectrum, the typical appraisal was 1.66 percent lower than expected in Chicago, 1.49 percent lower in Philadelphia, and 1.28 percent lower in Miami. Quicken Loans also issues monthly updates to its Home Value Index, where a