WRE News June 10, 2024
Buyer
U.S. homeowners with mortgages saw their home equity increase by 9.6% year-over-year during the first quarter, according to data from CoreLogic. This represents a collective gain of $1.5 trillion and an average increase of $28,000 per borrower from one year earlier, resulting in a total net homeowner equity to more than $17 trillion at the end of the quarter.
California homeowners saw the largest equity gain in the country at $64,000, with those in the Los Angeles metro area netting $72,000 year-over-year. Most of the other large equity gains were concentrated in the Northeast, most notably Massachusetts at $61,000 and New Jersey at $59,000.
On the flip side, the total number of mortgaged homes in negative equity decreased on a year-over-year basis by 2.1%, to 1 million homes or 1.8% of all mortgaged properties.
“With home prices continuing to reach new highs, owners are also seeing their equity approach the historic peaks of 2023, close to a total of $305,000 per owner,” said Dr. Selma Hepp, chief economist for CoreLogic. “Importantly, higher prices have also lifted some 190,000 homeowners out of negative equity, leaving only about 1.8% of those with mortgages underwater. Home equity is key to mortgage holders who have seen other homeownership costs soar, including insurance, taxes and HOA fees, as a source of financial buffer. Also, low amounts of negative equity are welcomed in markets that have shown price weaknesses this spring, such as Florida (1.1% of homes underwater) and Texas (1.7% of homes underwater) — both of which are below the national rate — as further price declines could drive more homeowners to lose their equity.”
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