The reason more owners were considered ‘stock-heavy’ in the first quarter of 2022

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Rising house prices caused many homeowners to become equity rich in the first quarter of 2022, according to a new ATTOM report. (iStock)

More Americans were considered “equity-rich” in the first quarter of 2022 – meaning they owed no more than 50% of their total home value – amid rising house prices, according to new data from ATTOM Data Solutions.

The number of equity-rich homeowners rose to 44.9% of mortgage holders in the first quarter, from 41.9% in the fourth quarter of 2021 and 31.9% in the first quarter of 2021, according to the first quarter of 2022 US Home Equity of the society. and underwater report.

The latest home price data shows that home values increased by nearly 20% per year in February, according to the S&P CoreLogic Case-Shiller US National Home Price Index. In some cities, the increases were even higher; in Phoenix, Arizona, home prices rose 32.9%.

“Homeowners continue to benefit from rising home prices,” said Rick Sharga, ATTOM’s Executive Vice President, Market Intelligence. “Record levels of home equity are providing financial security for millions of families and minimizing the risk of another housing market meltdown like the one we saw in 2008. But these higher home prices and rising housing interest rates make it extremely difficult for first-time buyers to enter the market.”

If you want to take advantage of the high value of your home and potentially want to lower your mortgage rate, you can consider cash refinancing to get cash out of your home. Visit Credible to find your personalized interest rate without affecting your credit score.

NEARLY THREE-QUARTERS OF US SUBWAYS TARGET DOUBLE-DIGIT INCREASES IN HOME PRICE IN Q1 2022: NAR DATA

Number of seriously underwater homes down from a year ago

While many homeowners are finding that their home’s value has never been higher, others are struggling because what they owe on their mortgage is more than the current value of their home. ATTOM data indicated that 3.2% of mortgaged homes – one in 31 homes – were considered seriously underwater in the first quarter of 2022.

Serious water occurs when the loan for a property is 25% higher than the estimated market value of the property. According to the report, the 3.2% of homes that fell into this category was only a slight increase from the 3.1% of homes with a mortgage in the fourth quarter of 2021.

However, it is still down significantly from 4.7% of homes – or one in 21 properties – a year ago.

In the United States, the number of equity-rich mortgage tiers increased in 48 states, according to the ATTOM report, while the share of severely underwater homes fell in 46 states.

If you want to get money out of your home or need to pay off your mortgage faster, consider refinancing your mortgage to lower your interest payments. Visit Credible to compare multiple mortgage lenders at once and choose the one with the best interest rate for you.

HOME PRICE GROWTH ACCELERATES IN FEBRUARY WITH 19.8% ANNUAL GAIN, DATA SHOWS

Home equity gains could rise in coming year, economist says

In the United States, the median house price increased by 2% from the end of 2021 to the beginning of 2022, according to the ATTOM report, reaching a new high of $320,500. This is an increase of 17% over the previous year and at least 10% in most of the United States.

Although house price gains are on the rise, Sharga says they are unlikely to slow in the coming year. The high home prices in the first quarter came amid a surge in homebuyers rushing to buy a home amid tight supply.

“Equity is likely to continue to grow through the remainder of 2022, although home price increases are expected to moderate as the year progresses,” he said. “Rising interest rates, the highest inflation in 40 years and continued supply chain disruptions from war in Ukraine are likely to weaken demand and slow price appreciation for real estate.”

Even homeowners facing foreclosure might have some equity. In fact, of the homes subject to foreclosure and possible lender takeover, 90% have at least some accumulated equity in the home, according to ATTOM’s report.

“Positive net worth should give financially distressed homeowners better options than their counterparts during the Great Recession, when 33% of all homeowners were underwater on their mortgages,” Sharga said. “I hope these borrowers can tap into their equity to refinance their debt or leverage it to sell their property and start afresh.”

If you want to tap into the equity in your home, contact Credible to speak to a mortgage expert and get all your questions answered.

You have a financial question, but you don’t know who to contact? Email the Credible Money Expert at [email protected] and your question might be answered by Credible in our Money Expert column.

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