If you’re a homeowner and live in certain parts of the country, your net worth may have just got larger. Gains in equity across the nation indicate that it pays to own a home right now.
“Nationally, the average homeowner with a mortgage saw their equity shoot up by nearly $16,200 in the past year alone, according to a recent report by CoreLogic,” reports Clare Trapasso, senior news editor of realtor.com and an adjunct journalism professor at St. John’s University.
Comparing the second quarter of this year to the second quarter of the previous year, that’s a 12.3% annual increase of home prices across the country.
Trapasso goes on to quote CoreLogic’s chief economist Frank Nothaft: ”It’s good news if you’re an existing homeowner. … You can certainly use that additional wealth as collateral you could borrow against if you’re looking to make some home improvements.”
West coasters accrued even more equity, with Californians gaining an average of $48,800 in just one year.
The realtor.com article goes on to quote Patrick Carlisle, a San Francisco Bay Area market analyst as saying, ”The first half of 2018 was probably the most ferocious market since the year 2000 in terms of buyer demand, competition between buyers, and overbidding. In the Bay Area, we saw some huge jumps in median sale prices. It’s crazy.”
These huge equity gains could slow down however, as inventories are expected to rise soon. If buyers have more to choose from, prices are less likely to be driven up by bidding wars.
According to the article, California’s gains were followed by Washington, where average home equity was up $41,100; Nevada, at $32,193; Hawaii, at $29,565; and Massachusetts, at $23,527.
States experiencing a loss in equity include Louisiana, Connecticut, and North Dakota, but in less than $1K amounts.