CoreLogic’s latest
Equity Report revealed
that 675,000 US homeowners regained positive equity in their homes in 2017.
This is great news for the country, as 95.1% of all mortgaged properties are
now in a positive equity situation.
“U.S homeowners with
mortgages (roughly 63% of all the properties) have seen their equity increase
by a total of $908.4 billion since the fourth quarter 2016, an increase of
12.2%, year over year.”
Price Appreciation = Good News for Homeowners
Frank Nothaft, CoreLogic’s
Chief Economist, explains:
“Home-price growth has been the primary
driver of home-equity wealth creation. The CoreLogic Home Price Index grew
6.2 percent during 2017. The largest calendar-year increase since 2013.
Likewise, the
average growth in home equity was more than $15,000 during 2017, the most in four years.”
He also believes this is a great sign for the market in 2018, saying:
“Because wealth gains
spur additional consumer purchases, the rise in home-equity wealth during
2017 should add more than $50 billion to U.S. consumption spending over the
next two to three years.”
This is great news for homeowners! But, do they realize that
their equity position has changed?
A study by Fannie Mae suggests that many homeowners are not aware that they have regained equity in
their homes as their investment has increased in value. For example, their
study showed that 23% of Americans still believe their home is in a negative
equity position when, in actuality, CoreLogic’s report shows that only 4.9% of homes are in that position (down from 6.3% in Q4 2016).
The study also revealed that only 37% of Americans believe that they have
“significant equity” (greater than 20%) when in actuality, 83% do!
This means that 46% of Americans with a mortgage fail to realize the
opportune situation they are in. With a sizeable equity position, many
homeowners could easily move into a house (either larger or smaller) that
better meets their current needs.
Fannie Mae spoke out on this issue in their report:
“Homeowners who
underestimate their homes’ values not only underestimate their home equity,
they also likely underestimate 1) how large a down payment they could make with
their home equity, 2) their chances of qualifying for mortgages, and,
therefore, 3) their opportunities for selling their current homes and for
buying different homes.”
Bottom Line
If you are one of the many Americans who is
unsure of how much equity you have built in your home, don’t let that be the
reason you fail to move on to your dream home in 2018! Let’s get together to
evaluate your situation!
THE MILITELLO TEAM
(978) 815-3877 - Joseph
(978) 500-1480 -Kathleen
Vice-President/Realtor
Source: Keeping Current Matters!