Several indices compiled by Quicken Loans point to a national housing market that is well into the stabilization cycle. The firm’s Home Price Perception Index — which compares the estimates homeowners supply on mortgage applications to the actual appraised value — fell by 1.4 percent in June.

Several indices compiled by Quicken Loans point to a national housing market that is well into the stabilization cycle.

The firm’s Home Price Perception Index — which compares the estimates homeowners supply on mortgage applications to the actual appraised value — fell by 1.4 percent in June. This indicates that the gap between appraised value and homeowner-perceived value is widening, something that has occurred for five straight months.

image001

“While each local market has a different story to tell, a large part of this perception gap is likely due to the normalization of home prices,” said Bob Walters, chief economist for Quicken Loans. “After about a year of home values trending upward, it takes some time for many homeowners to realize home values are stabilizing in their neighborhoods.”

[Tweet “Quicken chief economist: Normalization of home prices likely causing perception gap”]

Markets where the gap between appraised value and perceived value widened the most in June included Kansas City, which saw a 3.19 percent expansion. Philadelphia and Charlotte followed with declines of 2.83 percent and 2 percent. Chicago, Cleveland, New York, Atlanta and Baltimore saw gaps widen by 0.87 percent to 1.45 percent.

In contrast, some markets in California, Texas and Colorado are in a situation where appraised home values are coming in higher than homeowners’ estimates.

Top markets where this is occurring include San Jose, San Francisco, Denver, Houston, Dallas and Los Angeles. Boston, Sacramento, Riverside (California), Las Vegas, Seattle and Washington, D.C., represent other improving markets.

Via its Home Value Index, Quicken Loans reported that national home values increased by 0.74 percent in June when compared to May. Year over year, overall values have risen by 4.38 percent.

[Tweet “National home values increased by 0.74% in June”]

During that 12-month period, the West has seen a 7.63 rise in values, followed by the South (3.22 percent), Northeast (1.4 percent) and Midwest (1.35 percent).

“Home prices seem to be a bit frozen for the time being — validating that we are in a market that is well into the stabilization cycle,” Walters said. “The real test for home price solidity will be when inventory increases to a level of equilibrium between supply and demand.”

Email Erik Pisor.


Inman Connect San Francisco is right around the corner — register now and save $200!

Learn secrets from top agents to grow your business — attend Agent Connect!

Show Comments Hide Comments
Sign up for Inman’s Morning Headlines
What you need to know to start your day with all the latest industry developments
By submitting your email address, you agree to receive marketing emails from Inman.
Success!
Thank you for subscribing to Morning Headlines.
Back to top
×
Log in
If you created your account with Google or Facebook
Don't have an account?
Forgot your password?
No Problem

Simply enter the email address you used to create your account and click "Reset Password". You will receive additional instructions via email.

Forgot your username? If so please contact customer support at (510) 658-9252

Password Reset Confirmation

Password Reset Instructions have been sent to

Subscribe to The Weekender
Get the week's leading headlines delivered straight to your inbox.
Top headlines from around the real estate industry. Breaking news as it happens.
15 stories covering tech, special reports, video and opinion.
Unique features from hacker profiles to portal watch and video interviews.
Unique features from hacker profiles to portal watch and video interviews.
It looks like you’re already a Select Member!
To subscribe to exclusive newsletters, visit your email preferences in the account settings.
Up-to-the-minute news and interviews in your inbox, ticket discounts for Inman events and more
1-Step CheckoutPay with a credit card
By continuing, you agree to Inman’s Terms of Use and Privacy Policy.

You will be charged . Your subscription will automatically renew for on . For more details on our payment terms and how to cancel, click here.

Interested in a group subscription?
Finish setting up your subscription
×