The gap continues to narrow between homeowners’ and appraisers’ perceptions over home values. The latest Quicken Loans Home Price Perception Index shows that the average home appraisal in June was only 0.25 percent lower than what owners had estimated—this puts the two different value perceptions at their closest since February 2015.
Homeowners provide their home value estimate at the beginning of the refinance process; that is then matched against the actual value appraisers assigned to the property later during the mortgage process. The two perceptions over value have been inching closer together over the last few months. A year ago, homeowners were saying their homes were worth 1.70 percent more than appraisers’ valuations.
More metro areas, however, are seeing appraisals higher than what homeowners even expect. Nearly three quarters of the metro areas analyzed saw the bulk of appraisals return higher than what the owner expected.
“Getting an accurate market value is an important, albeit often misunderstood, part of the mortgage process,” says Bill Banfield, Quicken Loans Executive Vice President of Capital Markets. “The valuation has historically involved an appraiser coming to personally inspect the home and give their personal opinion of its value. Now, more technology is becoming available to modernize the appraisal process. However, even with a more data-based approach, there can be some disconnect between the appraised value and homeowners perception of value.”
