Homeowners Saw a $28K Increase in Equity Last Year

If you own a home, your net worth has likely increased significantly over the past year. As home prices continue to rise, you're building equity much faster than you might expect. Here's how it happens.

Equity is the difference between your home's current market value and the remaining balance on your mortgage.

In the past year, the demand for homes has exceeded the supply, driving up prices. This increase in home prices has directly boosted equity for homeowners.

How Much Equity Have You Built in the Last 12 Months?

The latest Homeowner Equity Insights from CoreLogic reveal that, on average, homeowners' equity has increased by $28,000 over the past year.

That's the national average, but if you're curious about your state's specifics, take a look at the map below. Using data from CoreLogic, it illustrates the equity growth in each state over the past year. You'll see that every state with sufficient data experienced annual equity gains:

What If You Purchased Your Home Before the Pandemic?

If you purchased your home before the pandemic, the equity outlook is particularly positive. According to data from Realtor.com, home prices surged by 37.5% from May 2019 to May 2024, suggesting a substantial increase in your home's value. Ralph McLaughlin, Senior Economist at Realtor.com, notes:

"Homeowners have experienced remarkable increases in home equity over the last five years."

Providing perspective on how equity can accumulate over time, Selma Hepp, Chief Economist at CoreLogic, details the total equity held by the average homeowner today:

"As home prices continue to set new records, homeowners are approaching the historic equity peaks of 2023, nearing approximately $305,000 per owner."

Utilizing Your Increasing Home Equity to Your Advantage

Given the surge in prices a few years back and the continued growth today, homeowners have undoubtedly amassed significant equity – which comes with substantial benefits.

You might leverage it to launch a business, finance education, or even assist with your next home purchase. When you sell, the equity you've accrued returns to you, potentially covering a significant portion—or even all—of your next home's down payment.

Bottom Line

If you're thinking about relocating, the equity you've accumulated can be incredibly beneficial. Interested in understanding your equity and exploring how it can contribute to your next home purchase? Reach out to a nearby real estate agent for guidance.