2017 marks largest increase since 2013
Rising home prices might be getting buyers down, but for already existing homeowners? They’re offering serious financial benefits. According to new data from CoreLogic, the average homeowner saw their home equity jump by more than $15,000 last year alone – the biggest increase in four years.Verify your new rate (Jul 12th, 2020)
It pays to buy a house
According to CoreLogic’s recent Home Equity Report, American homeowners saw a 12 percent year-over-year jump in equity from 2016 to 2017. Though the average homeowner gained $15K in equity for the year, in some states, it rose as high as $44,000.
Frank Nothaft, CoreLogic’s chief economist, credits rising home prices for the uptick in equity.
“Home price growth has been the primary driver of home equity wealth creation,” Nothaft said. “The average growth in home equity was more than $15,000 during 2017, the most in four years.”
Though increased equity certainly spells good news for existing homeowners, it also bodes well for the country’s economy at large.
“Because wealth gains spur additional consumer purchases, the rise in home equity wealth during 2017 should add more than $50 billion to U.S. consumer spending over the next two to three years,” Nothaft said.Verify your new rate (Jul 12th, 2020)
Where equity grew the most
Californians saw the biggest rise in home equity, with the average homeowner gaining $44,000 over the year. Washington homeowners experienced gains of $40,000, on average, while those in Utah, Nevada, Massachusetts and Idaho saw jumps of $20,000 or more. Equity decreased the least in Louisiana, where homeowners gained just $311 for the year.
According to Frank Martell, CoreLogic CEO and president, the discrepancies all come down to local home prices.
“There are wide disparities in home-equity gains by geographic area, with higher-priced, capacity constrained markets along the East and West Coasts registering the largest increases,” Martell said. “The average homeowner in California and Washington had a wealth gain of about $40,000, reflecting the high price of homes in California and the rapid appreciation in Washington. In contrast, the average owner in Louisiana had little change in their housing wealth during 2017, given much lower prices and modest price growth.”
Get today’s mortgage rates
Buying a house can offer serious long-term returns – and CoreLogic’s report is proof. Want to invest in your future? Shop around and see what mortgage rates you qualify for today.Verify your new rate (Jul 12th, 2020)