Hey homeowners, your equity just grew (well, some of you)!
Just got done reading Ken Harney's Homeowner equity makes surprise turnaround. Ken reported on the "Flow of Funds" survey performed on homeowners. Here's of the interested stats.
"...net equity grew by nearly $1 trillion between the recession's nadir in the first quarter of 2009 through the third quarter. From last June 30 through Sept. 30, net equity rose by $418 billion."
Ken also reviews Zillow's report that shows that home equity was practically flat (better than shrinkage).
Sure, I think many markets have more of a correction (especially my home market, New York), after three years of massive shrinkage in homeowners home equity, it's nice to see signs of a turnaround.
For those markets that are seeing a rebound in home equity, they could start to see a decline in the rate of foreclosures.
"Mortgage market analyst Laurie Goodman, senior managing director of Amherst Securities, recently warned lenders to be especially vigilant about borrowers in markets where negative equity ratios are high because, in her view, they are prime candidates to walk away from their loans.
Once underwater borrowers miss just one payment on their mortgage, according to Goodman, there is a 75 percent to 80 percent probability they will chuck the whole deal. "
Check out Homeowner equity makes surprise turnaround on the Miami Herald web site for more details.