Home Equity Gains Top $1Trillion in 1st Quarter
Mike Sorohan email@example.com
CoreLogic, Irvine, Calif., said 84,000 residential homeowners regained equity in the first quarter, while homeowners with mortgages saw their equity increase by 13.3 percent year over year, representing a gain of $1.01 trillion.
The company's quarterly Home Equity Report noted the average homeowner gained $16,300 in home equity over the past year. While home equity grew nationwide, western states experienced the largest increase: Washington homeowners gained an average of $44,000 in home equity, while California homeowners gained an average of $51,000.
CoreLogic said from the fourth quarter to the first quarter, the total number of mortgaged homes in negative equity decreased by3 percent to just under 2.5 million homes, or 4.7 percent of all mortgaged properties. Negative equity decreased by 21 percent year over year from 3.1 million homes--or 6.1 percent of all mortgaged properties.
"Home-price growth has accelerated in recent months, helping to build home-equity wealth and lift underwater homeowners back into positive equity, the primary driver of home equity wealth creation," said Frank Nothaft, chief economist with CoreLogic.
Negative equity peaked at 26 percent of mortgaged residential properties in fourth quarter 2009, based on the CoreLogic equity data analysis which began in third quarter 2009. The national aggregate value of negative equity was $284.8 billion at the end of the first quarter, up quarter over quarter by $100 million, from $284.7 billion a year ago.
"Home equity balances continue to grow across the nation," said Frank Martell, president and CEO of CoreLogic. "In the far Western states, equity gains are fueled by a long run in home price escalation. With strong economic growth and higher purchase demand, we expect these trends to continue for the foreseeable future."
CoreLogic said should home prices continue to increase by 5 percent, an additional 500,000 properties could emerge from negative equity over the next year.