Homeowners in the U.S. are continuing to see their equity grow. According to a recent Q2 2024 Home Equity Report from CoreLogic, an information services provider of financial, property, and consumer data, homeowners with mortgages experienced a total equity increase of $1.3 trillion, or about 8% year-over-year, in Q2 2024. This brings total homeowner equity to over $17.6 trillion. Additionally, the number of homes with negative equity dropped by 4.2% from Q1 2024, and by 15% from the previous year.
The Northeast saw the strongest equity gains, driven by high home price growth, with California seeing similar increases. On the other hand, areas that saw high population growth during the pandemic, such as Colorado, Texas, and Idaho, are experiencing smaller equity gains as their markets start to stabilize.
Because home equity is affected by home price changes, borrowers with equity positions near (+/- 5%) the negative equity cutoff are most likely to move out of or into negative equity as prices change, respectively. Looking at the second quarter of 2024 book of mortgages, if home prices rose by 5%, 105,000 homes would regain equity; if home prices fell by 5% 139,000 would fall underwater.
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