Home valuations across the country are on the rise, but so are homeowners’ perceptions of what their homes are worth—at a slightly higher pace. According to Quicken Loans’ Home Price Perception Index released Tuesday, home values assigned by appraisers were 1 point 93 percent lower than what homeowners perceived them to be in June. The gap between appraisers’ assigned values and homeowner perceptions has increased slightly since May, when it was 1 point 89 percent.
Quicken Loans Chief Economist Bob Walters said, quote, “Perception is everything. It can make or break a home sale or mortgage refinance. That’s why it’s so important for homeowners to realize how they perceive their home’s value could vary widely from how an appraiser views it. If the estimate is lower by just a few percentage points, the buyer could need to bring as much as another several thousand dollars to the table to avoid having to restructure the loan. Close quote
Recent international market blockbusters like China’s slowing economy and the Brexit vote were significant enough for Freddie Mac to revise what it had expected to happen in the U.S. economy through the end of next year, but the GSE says the turbulence abroad has created a highly buyer-friendly mortgage market. Freddie Mac stated that these developments are likely to result in a boost in housing activity, particularly refinance, as homeowners take advantage of the current low rates.