One way to determine the health of an economy is by looking at the available homeowner equity. The more equity that exists, the more money homeowners have to put into the system. Every quarter, financial analytics company CoreLogic® releases an equity report outlining the current state of home equity. These are the results for the second quarter of 2017.
Nationwide Homeowner Equity
Roughly, 63% of homeowners in the United States have a mortgage. According to CoreLogic®, home owners saw a total equity gain of $766.1 billion in the past year, a 10.6% gain. Over 750,000 homeowners regained positive equity with the average homeowner gaining $13,000 in equity in the past year.
From Q1 of 2017, homes with negative equity decreased 10% to 2.8 million homes (5.4% of all mortgage properties). That’s a 21.9% decrease from 3.6 million homes over the past year. A decrease in negative equity reduces mortgage risk.
North Carolina Homeowner Equity
The amount of equity gained depends a lot on the local real estate market’s growth and average home cost. During the recession, every real estate market in the United States took a hit, some states harder than others. Those took the most beating were often the ones to rebound the quickest. North Carolina has remained pretty moderate compared to others. While California has saw an average $30,022 equity gain per house, North Carolina’s was $7,198. It’s always nice to have more equity in your home; however, too large of a gain can signal a housing bubble and future troubles for the real estate market. So we’re happy to have a slow and steady climb.
North Carolina’s negative equity also took a dip. In the first quarter, it was 4.3%. In the second quarter, it went down to 4.0%. This puts the state in the Moderate category.
Homeowner equity is now twice what it was 5 years ago and CoreLogic® expects it to rise steadily over the next year. More equity results in more consumer spending and economic growth. As conditions improve for homeowners, more businesses will thrive and jobs will be created.
Want to download CoreLogic’s® Second Quarter 2017 Equity Report? You can do so here.