Still think there could be a housing recession? Waiting for the crash and prices to drop?
Homeowners in the United States have seen the value of their homes skyrocket over the past decade, and now the average American homeowner has a record amount of equity in their home. According to a new report from CoreLogic, the average American homeowner now has $300,000 in equity, which is up from $285,000 last year and $6,000 just 10 years ago.
This surge in home equity is due to a number of factors, including a strong job market, historically low interest rates, and continued population growth. The result is that more and more homeowners are seeing the value of their homes increase year after year.
For potential homebuyers, this may seem like bad news. After all, if home prices continue to rise faster than incomes, it will become increasingly difficult for first-time buyers to afford a home. However, there is some good news on this front as well. According to the same report from CoreLogic, incomes are also rising across the country, which means that while home prices are increasing, so are wages.
The bottom line is that while the increase in home equity is good news for current homeowners, it could make purchasing a home more difficult for those who don’t already own one. However, with incomes also on the rise, it’s still possible for first-time buyers to enter the market and purchase their dream home.