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Quicken Loans Home Price Perception Index showed that homeowners continued to overvalue their homes in September, the eighth straight month that has happened.

Meanwhile, home values rose ever so slightly, making up for losses in August. Values are up 3.11% since September 2014.

Home Price Perception Index (HPPI)


Septembers HPPI showed that homeowners are overvaluing their homes by 2.00%. This represents the eighth straight month homeowner views of their property value have been higher than appraiser opinions.

Despite the differences of opinion, we may actually be trending in the right direction. The gap has closed from 2.65% in August.

Despite the narrowing of the gap, Quicken Loans Chief Economist Bob Walters said even a small gap can make a big difference because of the size of the values.

“It may not seem like homeowners assuming their home’s value is 2% higher than appraisers’ opinions is significant, but it could make a huge difference in metro areas with higher average home values,” said Walters. “It could also cause complications for homeowners looking to refinance, who may be close to the loan-to-value thresholds to qualify, or for those looking to eliminate mortgage insurance. We encourage consumers to stay aware of sales prices on comparable homes in their area to have a better idea of their home’s value.”

Turning to the regional data, the Midwest is furthest from appraiser opinion with a 2.25% gap. The Northeast follows, coming in at 2.13%, while the South sits at 2.03%. The West is closest to appraiser opinion, coming in at 1.62% above appraiser opinion.

At the metropolitan level, San Jose, CA, homeowners continue to underestimate their home values by 5.74%, the highest among the cities surveyed. Meanwhile, Philadelphia sat at the opposite end of the spectrum, overvaluing their homes by 3.58%. San Diego scored a perfect bulls-eye, with homeowners and appraisers being in complete agreement on prices.

Home Value Index (HVI)


Home values rose 0.05% nationwide – still pretty flat and just enough to make up slips in August.

Home values are in a period where theyve stagnated and arent moving very much one way or the other.

One place where home values seem to be steadily on the rise is in the West.

“I don’t think it’s a coincidence the West is showing the greatest home value increases with almost all of the western cities measured in the HPPI exhibiting appraiser opinions higher than homeowner estimates,” Walters said. “Homeowners are hearing national reports of slower home value increases, or even drops in value, when that isn’t the case everywhere. Appraisals are telling a different story in many western cities, but homeowners may not realize home values are still making such strides.”

Looking across the country, values are up 0.72% in the West and 0.29% in the South compared to August. The Northeast and Midwest struggled month-to-month with decreases of 0.46% and 0.14%, respectively.

The Quicken Loans Home Price Perception Index and Home Value Index come out on the second Tuesday of each month on the Quicken Loans Press Room.

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