Corelogic recently released its Homeowner Equity Insights report for the fourth quarter of 2020 and the results are astounding. Homeowners with mortgages saw an average 16.2% year-over-year increase in equity in 2020. That was close to a $1.5 trillion gain.
If you aren’t sure what equity is in real estate, it’s the value of a property minus any charges against it. For example, if a home is likely to sell for $365,000 and has a mortgage for $300,000, it has $65,000 in equity. If home values go up in value by 3% over the next year, it would then be worth $375,950 with $75,950 in equity, PLUS any payments made to the mortgage principal during those 12 months.
Negative equity, also referred to as being “upside down” on a mortgage, is when homeowners owe more on their loan than what their home is worth. Negative equity dropped 21% in the United States in 2020 and brought 410,000 homes right side up.
The year-over-year average equity gain in North Carolina in 2020 was $21,000. The state now shares 3.2% of the national negative equity. That places it in the Moderate category for negative equity, but only one state is considered Low – Oregon.
Want to take advantage of newfound equity in your home? Call us for an estimate of your home’s fair market value. This is useful if you’re considering listing your home for sale or refinancing. We can put you in contact with a great local lender who will help you take advantage of today’s low rates.
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