Photo: Jeff Turner/Flickr
The gap between how US homeowners and appraisers view home values continued to widen in April. And according to new data from Quicken Loans, April marked the fifth consecutive month the gap widened.
Homeowner estimates of home values were on average 1.9 percent higher than appraiser estimates in April, says the Quicken Loans National Home Price Perception Index (HPPI). This was up from the average 1.77 percent difference recorded by the HPPI in March.
The HPPI compares home values supplied by homeowners on a refinance mortgage application with the home value determined by an appraisal done later in the mortgage process.
“The appraisal is one of the most important data points in a mortgage transaction. This single number can impact how much money a buyer needs to bring to closing, or the equity that is available to the homeowner on a refinance,” says Quicken Loans Vice President of Capital Markets Bill Banfield.
Additionally, if homeowners had a clearer picture of home values in their area, it could lead to an overall smoother mortgage process, adds Banfield.
And while the HPPI reveals a widening gap in home value perception, appraised home values accelerated in April, says Quicken Loans.
The Home Value Index (HVI) rose 1.06 percentage points from the previous month to an index level of 101.52 in April. Appraisal values were up 5.08 percentage points from last year, according to the HVI. April’s reading was up from the 3.30 percentage point year-over-year gain recorded in March.
The HVI revealed positive momentum nationwide — from the Northeast recording 3.54 percent annual growth in April, to the 6.52 percent annual gains recorded in the West.
A national view of home value trends based solely on appraisal data from home purchases and mortgage refinances, the HVI began tracking appraisal home values in January 2005, when the index had a reading of 100.
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