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BLOCKBUSTER EQUITY NEWS you can’t miss

Only about eight in every 100 homes are still underwater, and that’s great news for American homeowners. More homeowners now have equity than they have since the housing crash, with about 46.7 million residential properties with a mortgage registering at least some equity at the end of the first quarter of 2016. That equated to a home equity leap of about $762 billion year-over-year, reported CoreLogic.

According to the real estate data giant, 268,000 homeowners regained equity between January 1, 2016 and March 31, 2016. That number boosted the percentage to 92 percent of all mortgaged properties having equity. “In just the last four years, equity for homeowners with a mortgage has nearly doubled,” observed CoreLogic chief economist Frank Nothaft. He added, “The rapid increase in home equity reflects the improvement in home prices, dwindling distressed borrowers, and increased principal payments.” He also predicted that the increase in equity would help the overall economy and that the number of underwater borrowers would continue to fall over the remainder of 2016.

Interestingly, five states account for nearly a third of all negative equity in the United States. Nevada, Florida, Illinois, Rhode Island, and Maryland all have more than 12 percent homes still underwater in their states.

Lesson Learned:

The housing recovery is still regional. Investors must remember to evaluate state and local trends before sinking money into any market.

Point to Ponder:

Nothaft said if equity rises a “uniform five percent across the U.S.” then the number of underwater borrowers will fall by another 1 million. Do you think that this is likely?

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About the Author

Carole Ellis is the host of Real Estate Investing Today, a popular 9-minute daily podcast focused on educating real estate investors about the important topics that will make their investing SAFER, FASTER, and MORE PROFITABLE. She's also the editor of the Bryan Ellis Investing Letter. She has more than a decade's worth of experience in and reporting on the real estate industry and, additionally, has written dozens of courses on the topic. Carole lives in Kennesaw with her husband, Bryan, and four children. She believes wholeheartedly that your best investment is always your OWN education.

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