The January change reversed seven consecutive months of gap declines
The difference between homeowner expectations and appraisal values of home prices widened in January, reversing a seven-month trend of continuing improvements, according to the Home Price Perception Index (HPPI) released by Quicken Loans.
The HPPI showed appraisers valued homes an average of 0.6% lower than what owners estimated. The gap compares to a 0.5% average. Despite the monthly decrease, the January index marks an improvement from the year-ago period when appraisals were 1.47% lower than owner expectations.
Although homeowner perceptions slightly differed from appraisals, January posted continued increases in home equity across the country. The Home Value Index, which is based on appraisal data, showed values increasing 0.46% compared to December. The annual growth was even stronger, with home values jumping 7.03% from the same month in 2017.
While values increased nationally, the South region trailed the rest of the country with a 0.54% monthly decline in January. Appraisals grew annual for every region, with the West posting the biggest gain.
"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," Quicken Loans EVP of Capital Markets Bill Banfield said. "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."Related stories:
Appraiser, owner home-value opinions move closer in December
Appraiser, owner home-value opinion gap narrows the most in November
