Home Equity Grew $1T This Year, Breaking Six-Year RecordsHome Equity Grew $1T This Year, Breaking Si
Homeowner equity rose again in the third quarter of 2020, reaching the highest total in over six years. CoreLogic's quarterly report on that asset says that those homeowners with mortgages, about 63 percent of the total, saw their equity grow by 10.8 percent since the third quarter of 2019. This equates to an increase in homeowner wealth of about $17,000 per household, the largest since the first quarter of 2014, and an aggregate national gain of about $1 trillion. At the same time, the number of mortgages that were in negative equity fell by 18.3 percent on an annual basis.
The equity growth was due to a surge in home prices during the summer and fall, as homebuyers emerged from the pandemic lockdown and competed for a low supply of homes on the market. CoreLogic says these equity gains are likely to persist over the next several months as home purchase demand is expected to remain high, pushing prices up. However, the company expects appreciation to slow over the next 12 months as new home construction and more existing for-sale homes ease supply pressures.
The largest gains were in Washington, where homeowners gained an average of $35,800; California, an average of $33,800 and in Massachusetts, where gains averaged $31,200. Meanwhile, North Dakota, which was hit hard by the pandemic, experienced the lowest annual gain ($5,400) in the third quarter of 2020. BY: JANN SWANSON Mortgage News Daily