Household held real estate rose $1.388 trillion from the second quarter of 2015 to 2016, and home mortgage debt rose $144 billion over the same four-quarter period.
According to NAHB Eye on Housing, these rates mean that home equity held by households grew $1.24 trillion (10.8 percent) to $12.74 trillion. A household’s home equity is now 57.1 percent of household real estate.
While owners’ equity in their homes is rising as values appreciate, the falling home ownership rate means a smaller proportion of households are benefitting. Part of the reason for the decline in homeownership is that it is becoming difficult to build new homes at prices a large part of the market can afford. In an earlier post NAHB showed that 31 percent of homebuyers want to buy homes for under $150,000 while only 6 percent of new homes are priced that low.