There is a disconnect between homeowners and appraisers in Chicago, according to Quick Loans’ latest National Home Price Perception Index (HPPI).
The good news is the disconnect is slight. In February, homeowner opinion in Chicago placed the average home price at $192,000, less than 2 percent above what local appraisers said.
|City||Homeowner Opinion||Appraiser Opinion|
Understanding the difference between what someone thinks their home is worth and what it actually is worth is so important because, as Quicken Loans Chief Economist Bob Walters pointed out in a statement accompany the HPPI release, it helps create a much smoother home purchase or selling process.
“Having a good understanding of the conditions in their local housing market can be a valuable tool for consumers as they prepare for the home buying or mortgage process,” said Walters. “Accurate expectations at the onset of the mortgage process, not only makes it smoother, but can prevent unexpected changes in the amount of funds to bring to the closing table if the appraised value comes in lower than initially estimated.”
As if that wasn’t incentive enough, in a recent speech Gary Keller, founder of Keller Williams Realty, emphasized the importance accurate pricing, presenting results from a study his brokerage conducted (organized in the table below) that showed “precipitous drops” with each repricing of a home.
|# Price Reductions||Days on Market||Sold Price/Original Price||# of Transctions|