More than 90% of Homes have Positive Equity

91.5% of Homes in the US have Positive Equity

 Wednesday March 23rd, 2016  For Buyers, For Sellers, Move-Up Buyers

CoreLogic’s latest Equity Report revealed that one million borrowers regained equity in their homes in 2015. The outlook for 2016 remains positive as well, as an additional 850,000 properties would regain equity if home prices rose another 5% this year. 

The study also revealed:

• 95% of homes valued over $200,000 now have a positive equity position
• 87% of homes valued under $200,000 have entered a positive position
• The 11.5% growth in home equity in Q4 marked the 13th consecutive quarter of double digit gains

Below is a map showing the percentage of homes with a mortgage, in each state, that have positive equity. (The states in gray have insufficient data to report.)

Significant Equity Is On The Rise

Anand Nallathambi, President & CEO of CoreLogic, believes this is great news for the “long-term health of the U.S. economy.” He went on to say:

“The number of homeowners with more than 20% equity is rising rapidly. Higher prices driven largely by tight supply are certainly a big reason for the rise, but continued population growth, household formation and ultralow interest rates are also factors.”

Of the 91.5% of homeowners with positive equity in the US, 72.6% have significant equity (defined as more than 20%). This means that nearly three out of four homeowners with a mortgage could use the equity in their current home to purchase a new home now.

The map below shows the percentage of homes with a mortgage, in each state, with significant equity.

Bottom Line

If you are one of the many homeowners who is unsure of how much equity you have in your home and are curious about your ability to move, let's meet up to evaluate your situation.

Are Your Housing dollars helping you build wealth

As you pay down your mortgage each month your housing expense is building wealth

Equity Matters A LOT… Just Ask Freddie Mac

 Monday November 23rd, 2015  First Time Home Buyers, For Buyers

There are many reasons, both financial and non-financial, that homeownership remains an important part of the American Dream. One of the biggest reasons is the fact that it helps build family wealth. Recently, Freddie Mac wrote about the power of home equity. They explained:

“In the simplest terms, equity is the difference between how much your home is worth and how much you owe on your mortgage. You build equity by paying down your mortgage over time and through your home's appreciation. In a nutshell, your money is working for you and contributing toward your financial future.”

They went on to show an example where a person bought a home for $150,000 with a down payment of 10% ($15K), resulting in a loan amount of $135,000. The buyer secured a 30-year fixed-rate mortgage at 4.5% with a monthly mortgage payment of $684.03 (not including taxes and insurance).

The chart below demonstrates the home equity built after 7 years of making mortgage payments and assuming the historic national average of 3% per year home appreciation:

And that number continues to build as you continue to own the home.

Merrill Lynch published a report earlier this year that showed the average equity homeowners have acquired by certain ages.

Bottom Line

Home equity is important to building wealth as a family. Referring to the first scenario above,Freddie Mac explained:

“Now, if you continued to rent, and made the same payment of $684.03 per month, you'd have zero equity and no means to build it. Building equity is a critical part of homeownership and can help you create financial stability.”

Put your housing cost to work for you and your family. Let's get together to explore your options.

When you are ready to put your housing dollars to work toward building wealth, call, text or email.

HAPPY THANKSGIVING