Americans have seen the equity in their homes increase by 29.3% year over year in the fourth quarter of 2021 according to the CoreLogic Homeowner Equity Insights. The average home equity gained $55,000 during the same period.
CoreLogic’s Home Price Index reported a 19.1% increase in appreciation for the previous twelve months ending in January 2022. This increase in value is fueling the increased equity that homeowners are experiencing.
Some homeowners are doing cash-out refinancing and using the funds for a variety of purposes like home improvements, investing, saving for retirement, college or rainy-day funds.
Other homeowners are seeing the increased value of their homes as an opportunity to move up to a home that meets more of their current lifestyle. In some cases, adult children have moved back home, and in others, working remotely has made their current home not as ideal as it once was.
Homeowners now realize that their home has been a good investment and are willing to re-invest in a larger home that meets their current needs. With their increased equities and mortgage rates still under 5.00%, they can get into a new home and the higher value home will continue to increase.