Photo: Unsplash/Daiga Ellaby
In the first quarter of 2018, the collective home equity level in the U.S. topped $1 trillion, the largest gain in four years, according to a new report from CoreLogic.
The average borrower gained $16,300 in home equity over this time, and 84,000 borrowers are no longer underwater on their home loans and regained equity. The share of homeowners that remain underwater stands at 4.7 percent, CNBC reports. Frank Nothaft, CoreLogic's chief economist, says, "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."
Ironically, homeowners gaining equity and homeowners with negative equity are part of the reason home prices are rising so quickly. Supply is so lean and demand is so strong that new listings are moving very quickly and the majority are selling above list price. Bidding wars are fast becoming the norm. "What is available for sale is going under contract at a rapid pace," said Lawrence Yun, chief economist for the Realtors. "Since NAR began tracking this data in May 2011, the median days a listing was on the market was at an all-time low in April, and the share of homes sold in less than a month was at an all-time high."