• Home values rose 0.46% nationally in January, with a 7.03% year-over-year increase, according to the Quicken Loans HVI
DETROIT, February 13, 2018 – The gap between an appraisal value and homeowner expectations widened in January – reversing course for the first time in eight months. The National Quicken Loans Home Price Perception Index (HPPI) showed appraisers valued homes an average of 0.6 percent lower than what owners estimated.
Despite the slight difference in perception, the Quicken Loans Home Value Index (HVI) – the only measure of home value change based solely on appraisal data reported climbing home values. On a national level, appraisal values increased 0.46 percent from December to January. The annual growth was even stronger, with home values jumping 7.03 percent from the same month of the previous year.Home Price Perception Index (HPPI)
Appraisals in January were an average of 0.6 percent lower than the estimate homeowners give at the beginning of the mortgage process, as measured by the National HPPI. While not a drastic change from December, this marks the first decrease in the HPPI in eight months. However, January’s National HPPI value is much improved compared to the same time last year, when appraiser opinions were 1.47 percent lower than owner expectations.
“The appraisal is one of the most important pieces of data in the mortgage process. Often the entire transaction hinges on the appraisal showing a number similar to what the homeowner estimated at the beginning of the process,” said Bill Banfield, Quicken Loans Executive Vice President of Capital Markets. “If the appraisal is lower it could mean the homeowner needs to bring additional cash to close, or the loan may need to be reworked. It’s very promising to see the homeowner estimate and the appraiser opinion so close together.”Home Value Index (HVI)
Home equity continued to rise across the country in January, with appraisal values increasing 0.46 percent from the previous month and jumping 7.03 percent as compared to the previous January. The only region that dropped in value was the South, showing a 0.54 percent decrease from December to January. Every region reported annual appraisal growth with the West continuing to lead the way.
“Low inventory of homes available for sale and a growing economy has led to steadily rising home values as indicated by the strong annual increase of the HVI index,” said Banfield. “The recent increase in interest rates could test affordability in the short run, but the desire to own a home remains on firm ground and may ultimately help normalize the inventory issues.”
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 largest mortgage lender. The company closed more than $400 billion of mortgage volume across all 50 states from 2013 through 2017. Quicken Loans moved its headquarters to downtown Detroit in 2010, and now more than 17,000 team members from Quicken Loans and its Family of Companies work in the city’s urban core. The company 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 eight consecutive years, 2010 – 2017, and highest in customer satisfaction among all mortgage servicers the past four years, 2014 – 2017.
Quicken Loans was ranked No. 10 on FORTUNE magazine’s annual “100 Best Companies to Work For” list in 2017, and has been among the top 30 companies for the past 14 consecutive years. The company has been recognized as one of Computerworld magazine’s “100 Best Places to Work in IT” the past 13 years, ranking No. 1 for eight of the past 12 years, including 2017. The company is a wholly-owned subsidiary of Rock Holdings, Inc., the parent company of several FinTech and related businesses. Quicken Loans is also the flagship business of Dan Gilbert’s Family of Companies comprising nearly 100 affiliated businesses spanning multiple industries. For more information and company news visit QuickenLoans.com/press-room.