IRVINE, Calif.–Americans’ equity in their homes continues to rise as the housing market remains robust.
U.S. homeowners with mortgages (approximately 63% of all homeowners) have collectively seen their equity increase 11.8% year over year, representing a gain of $870.6 billion since Q3 2016, according to the
Q3 2017 home equity analysis from CoreLogic. In addition, homeowners gained an average of $14,888 in home equity between Q3 2016 and Q3 2017.
Western states led the increase, while no state experienced a decrease. Washington homeowners gaining an average of approximately $40,000 in home equity and California homeowners gaining an average of approximately $37,000 in home equity, CoreLogic reported.
The Q3 2017 Home Equity Analysis shows that on a quarter-over-quarter basis, from Q2 2016 through Q3 2017, the total number of mortgaged homes in negative equity decreased 9% to 2.5 million homes, or 4.9% of all mortgaged properties. Year over year, negative equity decreased 22% from 3.2 million homes, or 6.3% of all mortgaged properties, from Q3 2016 to Q3 2017, the company said.
“Homeowner equity increased by almost $871 billion over the last 12 months, the largest increase in more than three years,” said Dr. Frank Nothaft, chief economist for CoreLogic. “This increase is primarily a reflection of rising home prices, which drives up home values, leading to an increase in home equity positions and supporting consumer spending.”
Negative equity, or those loans that are upside down, peaked at 26% of mortgaged residential properties in Q4 2009 based on CoreLogic equity data analysis, which began in Q3 2009.
According to CoreLogic, the national aggregate value of negative equity was approximately $275.7 billion at the end of Q3 2017. This is down quarter over quarter by approximately $9.1 billion, or 3.2%, from $284.8 billion in Q2 2017 and down year over year by approximately $9.5 billion, or 3.3%, from $285.2 billion in Q3 2016.
“While homeowner equity is rising nationally, there are wide disparities by geography,” said Frank Martell, president and CEO of CoreLogic. “Hot markets like San Francisco, Seattle and Denver boast very high levels of increased home equity. However, some markets are lagging behind due to weaker economies or lingering effects from the great recession. These include large markets such as Miami, Las Vegas and Chicago, but also many small- and medium-sized markets such as Scranton, Pa. and Akron, Ohio.”