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The result of the 29.3% increase in homeowners' equity is a whopping $2.9 trillion gain for Q2 2021 and an average gain of $51,500 per borrower. The negative equity share fell to 2.3% in Q2 2021, marking the lowest share in at least 12 years, according to CoreLogic.
According to the report, by June 2021, consumer confidence had risen to its highest level since the onset of the pandemic. That positive sentiment carried over into CoreLogic's consumer survey, which found that 59% of respondents feel extremely confident in their ability to keep current on their mortgage payments in the coming year.
“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, president and CEO 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.”
“Home equity wealth is at a record level and will bolster economic activity in the coming year,” said Dr. 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.”
The report states that the majority of borrowers that fell behind on payments have a large home equity cushion that will help them avoid foreclosure.