Home Owner Equity Gains Reach an All Time High

Rising home prices and conservative borrowing have brought home equity gains to an all time high, according the CoreLogic’s Home Equity Report.

Today’s mortgage homeowners - approximately 64% of all properties - saw an equity increase of 5.1% year-over-year in the third quarter. The average homeowner gained $5,300 worth of annual equity in 2018, a nationwide gain of $457 billion.

Home equity increased in 44 of the 50 states. Some states even saw increases over $20,000. Idaho was at the top of the list, with its homeowners gaining an average of $25,809 in equity. Other Mountain West states following close behind, Wyoming and Utah’s homeowners increased their equity by about $23,975 and $21,043. Nevada fell above the national average at $8,000 in increased equity.

Thanks to these rising home prices across the nation, negative equity share also continues to drop. Negative equity - those underwater, owing more on their loans than the value of their home -peaked in the fourth quarter of 2009 at 26% of all mortgaged properties. However, CoreLogic’s current report revealed a decrease from 22 million to 2 million homes, or about 10% in the third quarter, and 4% from the prior quarter. North Dakota was the only state with equity depreciation at -$913.

“Ten years ago, during the depths of the Great Recession, more than 11 million homeowners had negative equity or 25% of mortgages homes,” said Frank Nothaft, chief economist for CoreLogic, “After more than eight years of rising home prices and employment growth, underwater owners have been sloshed to just 2 million, or less than 4% of mortgaged homes.”

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