This year, home values have continued rising. Between February and March alone, a home’s worth has increased by .63 percent, which is 3.3 percent higher than home values last year. For the fourth consecutive month, however, appraised home prices have come out 1.77 percent lower than homeowners expected. This has particularly become an issue for specific parts of the country. Let’s take a closer look. 

Before we discuss which U.S. locations maintain a higher gap between home appraisals and homeowner estimates, it’s important to understand the difference between the two housing evaluations. Basically, a home appraisal is an estimate of a property’s value. It is based on factors such as the home’s square footage, number of bedrooms and bathrooms, location and age of the property, and interior upgrades. Homeowner estimates, on the other hand, are usually determined through online tools, like eppraisal, which uses public records of recently listed homes to determine the home’s value. As the two evaluation methods usually don’t take all of the same factors into consideration, a gap can occur.

This has particularly become a problem in various locations on the Midwest and East Coast, with Cleveland, Chicago, New York, and Tampa at the top of the list. In many parts of the West Coast, however, home prices have increased so quickly that homeowner estimates have continuously fallen short of home appraisals. Cities like Portland, Seattle, and San Francisco have experienced this trend.

No matter which U.S. housing market you’re located in, it’s important to consistently check in on the local market prior to selling or refinancing. For more information about home values, or to learn more about home financing, contact one of our mortgage specialists today.