Quicken Loans HPPI: Owner Perception of Home Values Improves for Fourth Consecutive Month

  • November 8, 2016
• Quicken Loans’ National HPPI shows appraised values were 1.15% lower than homeowners estimated in October
• Home values dipped 0.62% in October but rose 5.97% year-over-year, according to the National HVI

DETROIT, November 8, 2016 – Owner estimates of home values slightly exceeded appraisers’ opinions in October, although owner expectations moved closer to appraised values than they were in September. The average appraisal was 1.15 percent lower than the homeowner expected, according to the Quicken Loans Home Price Perception Index (HPPI). This represents a narrowing of the gap between homeowner estimates and appraiser valuations. In September, appraised values were 1.26 percent lower than homeowner expectation.

A second report released by Quicken Loans, the Home Value Index (HVI) – which is the only measure of home valuation based solely on appraisals – shows annual home value growth is steadily slowing. Nationally, appraised values rose a strong 5.97 percent year-over-year in October. However, this is a dip from September when home values rose 7.78 percent from the year prior.

October HPPI

Home Price Perception Index (HPPI)

Quicken Loans’ HPPI, the exclusive look at how homeowners are perceiving their home’s value, showed homeowners’ expectation of value is more aligned with appraisers’ opinion of value. Appraised values in October were 1.15 percent lower than what homeowners estimated at the start of the mortgage process, when viewed nationally. In September, appraisal values were 1.26 percent lower than what owners expected. This is the fourth consecutive month the HPPI moved closer to equilibrium. Local trends stayed largely the same from the month prior, with appraisal values rising past homeowner estimates in the West and home values falling below homeowner expectations in the East and Midwest.

“This information can be helpful to homeowners to either prevent bumps in the mortgage process or realize they may have more equity available to them than they think,” said Quicken Loans Chief Economist Bob Walters.

October HPPI

Home Value Index (HVI)

Average home values, as measured by appraisals, fell slightly in October showing a 0.62 percent decline according in the national HVI. This extended reductions seen in September, when appraised values dipped 0.28 percent. Despite monthly decreases, home values in October still showed strong growth of 5.97 percent as compared to October 2015. All regional areas measured by the HVI showed annual increases, ranging from 5.52 percent growth in the Northeast to an 8 percent rise in values in the West.

“The monthly dips in home values are likely a result of the cooling demand for housing during the autumn months,” said Walters. “Fluctuations in monthly numbers are expected. Attention should always be paid to the annual measures to ensure positive growth compared to the same season the previous year. The yearly measure in October continues to show strong growth and a positive outlook for housing.”

October Estimates and Appraiser Opinions

HVI Table National

October HVI Table Geographic Regions

HPPI Table Metropolitan Aresas

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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 closed more than $220 billion of mortgage volume across all 50 states, 2013- 2015. 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 six consecutive years, 2010 – 2015, 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.

HPPI - Home Values Across America

HPPI Difference Between Estimates and Home Values

Difference Between Estimages and Home Values

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