CoreLogic: Homeowner Equity Up 8.6% in Q4 2023

(Image courtesy of CoreLogic)

CoreLogic, Irvine, Calif., released its Homeowner Equity Insights report for the fourth quarter of 2023, finding homeowners with mortgages have seen their equity increase by a total of $1.3 trillion since Q4 2022. That’s a gain of 8.6% year-over-year.

The average U.S. borrower gained approximately $24,000 in equity in 2023, bringing total net homeowner equity to more than $16.6 billion.

The number of mortgages with negative equity decreased by 1.1% from the third quarter of 2023. Year-over-year, mortgages with negative equity fell 15%–representing 2.1% of all mortgaged properties.

Negative equity–sometimes referred to as a home being underwater or upside-down–is when borrowers owe more on their mortgages than their homes are worth.

That measure is strongly affected by current home prices, CoreLogic noted.

The national aggregate value of negative equity was about $323 billion at the end of Q4 2023. That’s up by 3% quarter-over-quarter from Q3 2023 and down 4% year-over-year.

“Rising home prices continue to fuel growing home equity, which, at $298,000 per average borrower remained near historic highs at the end of 2023. By extension, at 43%, the average loan-to-value ratio of U.S. borrowers has also remained in line with record lows, which suggests that the typical homeowner has notable home equity reserves that can be tapped if needed,” said Selma Hepp, Chief Economist for CoreLogic. “More importantly, home price growth over the last year has helped lift the equity of homeowners who were underwater because of 2022 price declines–meaning that their mortgage amount was higher than the value of their properties. Now, slightly more than 1 million borrowers are underwater, the lowest number recorded in CoreLogic historic data and significantly below the 12 million seen coming out of the Great Recession.”

By state, the highest home equity gains were in Rhode Island (up by $62,000), New Jersey (up by $55,000) and Massachusetts (up by $53,000).