Home Values Are At Their Highest Point In More Than 12 Years

Home values were up 0.6% in July and have reached their highest level since January of 2007. They’ve gone up 4.78% since July of 2018, according to Quicken Loans data.

Before we get there though, there’s good news to report in terms of agreements between homeowners and appraisers.

Home Price Perception Index (HPPI)

 

In estimates, homeowners overvalued their homes by 0.63% in July when compared against actual appraisal data. Still, this represents a marked improvement from the 0.71% gap seen in June.

Bill Banfield, Quicken Loans Executive Vice President of Capital Markets, said market conditions are keeping homeowners more in tune with the housing market around them.

“As expected, with mortgage rates at 3-year lows and the refinance share of mortgage activity continuing to hover above 50%, homeowners are increasingly aware of the true value of their home,” said Banfield. “Prices continue to increase in most areas, but the rapid growth of years past has moderated, giving homeowners a better sense of their home’s market value.”

On a regional basis, homeowners in the West are closest to actual appraised value, overestimating their property worth by 0.52%. Meanwhile, homeowners in the South were 0.63% high in their estimates. The Northeast and Midwest are bunched together with estimates coming in 0.67% and 0.69% above actual appraised value respectively.

Of the 27 cities surveyed, 20 of these had a difference between estimated and actual appraised value of less than 1%. This points to homeowners around the country having a better idea of local values. Charlotte, N.C. had the hottest housing market, as appraisals came in 1.92% higher than homeowner estimates. Meanwhile, homeowners in Chicago were on the other end of the spectrum with estimates 1.66% higher than those of appraisers. Portland, Ore.’s housing market is very close to complete balance with appraised values coming in 0.01% higher than homeowner estimates.

Home Value Index (HVI)

 

As briefly mentioned above, home values were up 0.6% in July and 4.78% year-over-year.

Banfield thinks lower mortgage rates will help buyers, but current homeowners will see real benefits from increased equity in their homes.

“The fact that July had the highest Quicken Loans Home Value Index since January 2007 has to be encouraging, especially to those who were deeply underwater during the worst of the recession,” he said. “The 1% drop in interest rates so far this year will help address affordability but the strength of the economy and a lack of new homes being built will also play a big role.”

Home values in the Northeast were up a sizable 1.34% in July and have risen 5.1% year-over-year. Meanwhile, the Midwest was up 1.06% and 5.45% since this same time a year ago. In the West, values are up 4.22% since last July after going up 0.22% throughout that month. Finally, values rose a very slight 0.04% in the South. They’ve risen 3.51% for the year.

Whether you’re in the market to buy a home or refinance your current one, low mortgage rates make this a great time to apply. If you have any questions, let us know in the comments below. You can also get started with one of our Home Loan Experts at (800) 785-4788.

The Quicken Loans Home Price Perception and Home Value Indexes are released on the second Tuesday of each month on the Quicken Loans Press Room.

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