In 2008, 79 percent of the $12.68 trillion in debt outstanding was housing debt. That equates to about $10 trillion. In the fourth quarter of 2015, the housing debts share of the overall debt decreased to 72 percent of the $12.12 trillion total, or $8.74 trillion.
A main contributor to the dwindling mortgage debt, according to MarketWatch, is the lower rate at which Americans are taking equity out of their homes. From 2003 to 2007, cash-out refinances and home equity lines of credit rose more than $300 billion every year. That number grew by only $30 billion in 2015.
Other factors for the decrease in mortgage debt are a slowed pace of homebuying, increased debt paydown thanks to lower interest rates, and tighter credit standards which mean most new mortgages are going to people with good credit.
While many view this shrinking mortgage debt as a good thing, some analysts worry that Americans’ equity is too concentrated in real estate assets.