In the Hudson Valley's housing market, April 2019 home prices are increasing at a slower pace (3.3%) than they have over last year (5.25%). (Click here to view
an interactive chart showing housing price comparisons for Westchester, Putnam, Orange and Rockland counties.) However, they are still are above historical norms. Recently the low supply of listed homes and high demand from buyers has pushed prices to rise.
This presents a challenge for Hudson Valley home sellers - setting the right price, which means not too high to scare off potential buyers, and not to low to sell the property short of its value.
In the mind of the homeowner, annual home price appreciation over 6% has become the new normal. This becomes a challenge when a homeowner looks to refinance or sell their home, as the expectation of what the homeowner believes the home should be worth does not always line up with the bank’s appraisal.
Every month, the Home Price Perception Index (HPPI) measures the disparity between what a homeowner seeking to refinance their home believes their house is worth and what an appraiser’s evaluation of that same home is.
Over the last five months, the gap between the homeowner’s opinion and the bank’s appraisal has widened to -0.78%. This is important for homeowners to note, as even a 0.78% difference in appraisal can mean thousands of dollars that a buyer or seller would have to come up with at closing (depending on the price of the home).
The chart below illustrates the changes in home price estimates over the last 12 months.
While the appraisal gap widens, another trend is also becoming more common.
According to realtor.com, “the share of homes which had their prices cut increased by 2% compared to last year”. Thirty-seven out of the 50 largest US housing markets saw an increase in overall price reductions.
In today’s market, you need an expert agent who can help price your house right from the start. Homeowners who make the mistake of overpricing their homes will eventually have to drop the price. This leaves buyers wondering if the price drop was caused by something wrong with the house. In reality, nothing is wrong- the price was just too high!
Global Property Systems says:
If you are planning on selling your house in today’s market, meet with a Global Property Systems local area expert who can help you set your listing price properly from the start!