The findings by the California-based analytical firm have indicated that American homeowners have gotten nearly $2 trillion richer as real estate prices continue to surge all across the country. Individuals with mortgages saw their equity climb by 20 percent in the first quarter from a year earlier. And broken down further, that’s an average gain of $33,400 for each homeowner.
CoreLogic noted that prices were 11 percent higher in March compared to the prior year, representing the biggest gain in fifteen years. In April, prices posted a 13 percent gain.
“Homeowner equity has more than doubled over the past decade and become a crucial buffer for many weathering the challenges of the pandemic,” Frank Martell, president and CEO of CoreLogic, said in a statement.
“These gains have become an important financial tool and boosted consumer confidence in the U.S. housing market, especially for older homeowners and baby boomers who’ve experienced years of price appreciation,” he added.
For those who are still facing economic hurdles, the researchers noted that perhaps tapping into that home equity will make a huge difference.
“Double-digit home price growth in the past year has bolstered home equity to a record amount. The national CoreLogic Home Price Index recorded an 11.4 percent rise in the year through March 2021, leading to a $216,000 increase in the average amount of equity held by homeowners with a mortgage,” Dr. Frank Nothaft, chief economist for CoreLogic, said in a statement.
“This reduces the likelihood of large numbers of distressed sales from homeowners who emerge from forbearance later in the year,” he added.
Despite the massive appreciation in home values, those who are still struggling amid the pandemic may have the option to tap into the $10 billion Homeowners Assistance Fund (HAF), which aims to provide direct cash payments to states, territories, and tribes to assist property owners.
“The purpose of the Homeowner Assistance Fund is to prevent mortgage delinquencies and defaults, foreclosures, loss of utilities or home energy services, and displacement of homeowners experiencing financial hardship after January 21, 2020,” the Treasury Department says on its website. “Funds from the HAF may be used for assistance with mortgage payments, homeowner’s insurance, utility payments, and other specified purposes.”
In addition to having experienced monetary hardship after January 21, eligible homeowners should also have income equal to or less than 150 percent of the area median income, have proof of the stated financial hardship, and have a mortgage balance that is less than $548,250.
Ethen Kim Lieser is a Minneapolis-based Science and Tech Editor who has held posts at Google, The Korea Herald, Lincoln Journal Star, AsianWeek, and Arirang TV. Follow or contact him on LinkedIn.