PROVIDENCE – Homeowners with mortgages in Rhode Island saw an average equity gain of $68,345 from the second quarter of 2020 to the second quarter of 2021, according to CoreLogic Thursday.
Nationally, homeowners saw an average equity gain of $51,500 year over year in the second quarter, a 29.3% increase, attaining a combined $2.9 trillion in equity. CoreLogic noted that mortgaged properties account for roughly 63% of all properties nationwide.
“The growth in homeowner equity provides a strong financial cushion for tens of millions Americans. For those most impacted by the pandemic, equity gains will help play a critical role in staving off foreclosure,” said Frank Martell, CEO and president of CoreLogic. “Based on projected increases in economic activity and home values over the next year, we expect to see further gains in equity and a corresponding drop in negative equity, forbearance rates and foreclosure.”
Accompanying the increase in equity was a decline in negative equity share, the proportion of mortgage holders who owe more on their home loans than their property is worth. A mortgage with negative equity is often referred to as an “underwater mortgage.”
In Rhode Island, the negative equity share was 1.9% in the second quarter of 2021, a decline from 2.2% in the first quarter and 3.8% one year prior.
Nationally, the share of underwater mortgages was 2.3% in the quarter, the lowest share in at least 12 years and a decline from 3.2% one year.
“Home equity wealth is at a record level and will bolster economic activity in the coming year,” said Frank Nothaft, chief economist for CoreLogic. “Higher wealth spurs additional consumer expenditures and also supports room additions and other investments in homes, adding to overall economic activity.”
Rhode Island had the second-largest equity gain year over year in New England.
Other New England states’ mortgage equity data:
- Massachusetts: Homeowners saw an average equity gain of $73,749 year over year. The state’s negative equity share was 1.7%, a decline from 2.9% one year prior.
- Connecticut: Homeowners saw an average equity gain of $64,258 year over year in the quarter. Meanwhile, the share of negative equity in the state declined from 6.4% to 3.1%.
- New Hampshire: Homeowners saw an average equity gain of $54,917 year over year. The share of underwater mortgages was 1.9% in the second quarter, a decline from 3.2% on year prior.
- Maine: Homeowners in Maine saw an average equity gain of $37,307 year over year. The state’s negative equity share was 1.6% in the second quarter. CoreLogic did not provide data for Maine in the second quarter of 2020.
- Vermont: Mortgage equity data was not available for Vermont for the second quarter of both 2021 or 2020.
The full report may be viewed online.
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