In New York City we have begun to see a frenzy of real estate activity not seen in over a decade. Sellers are benefiting from high selling prices and a limited supply of inventory of housing. The boroughs of Queens and Brooklyn have been benefiting the most of the increase of home prices. In a report that doesn’t seem very surprising by CoreLogic home equity wealth attained by homeowners has reached an all-time high. The amount has surpassed the previous all time high which is from 2006 and the report further indicates that next year home equity wealth will surpass this year’s numbers.
Home equity wealth hit $13.9 trillion and surpassed the 2006 number by $.5 trillion. The report forecasts that home prices will increase another 5% next year which will increase equity by another 1 trillion dollars.
The home equity increase has been facilitated by significant home prices increase and lower supply of inventory of houses. The chart above shows the correlation of home price increase and the amount of individuals with negative equity. Homeowners with negative equity has decreased by over 9 million since 2011 as home prices continued to surge.
Should one decide to tap into their home equity it would allow financially strapped individuals to access cash in order to remodel their home or purchase additional real estate investments. Having the ability to also sell the property or rent is a great option for someone who purchased just a few years ago. There are many vehicles one could use to tap into your home equity such as HELOC (Home Equity Line of Credit) or a cash-out. The latter being the more popular approach.
If you are thinking about tapping into your home equity or just considering on purchasing a real estate investment than Blue Harbour Property Management is for you. We are a full service NYC property management company servicing Queens, Brooklyn, Manhattan and the Bronx.