As we close out 2015 and look ahead into 2016 projections, let’s take a stroll down a path of memory lane that most homeowners would likely choose to forget. It’s a town, street, locale where no one wants to go but many may have wandered unwillingly over the last several years. Where is this horrible place? It’s the galaxy of negative equity and a place not so distant for the market as a whole or most homeowners. The good news? Thanks to increases in home prices, the future looks brighter and negative equity is quickly becoming a galaxy, further and further away.
You’ve likely read, heard, or seen reports about the 1/4 point rise in Federal Interest rate announced by Treasury Secretary, Janet Yellen. If you’ve considered selling your home you have likely seen or may have even heard your neighbors talk about rising home prices in the neighborhood.
WHAT DOES IT MEAN
Rising Home Prices + Interest Rate Increase= ???
As these forces converge–if you’ll excuse the Star Wars reference–sellers can’t help but look forward to a sale that results in a faster sale at a higher price which increases their wealth. Simply put into words, “Homeowner equity is the largest source of wealth for many Americans. The rise in home price is expected to be at leaset 5% in 2016…” according to Anand Nallathambi, president and CEO of CoreLogic.
If you’re more of a visionary, I present to you, along with KCM, this infographic that explains the same and spells it out with positive equity reported across the U.S.A.
In short, the average homeowner now has 91.9% positive equity in their home. Positive equity often helps homeowners determine their wealth.
CoreLogic also released a year-over-year comparison which adds an historical perspective regarding the National home equity turnaround stating,
For the homes in negative equity status, the national aggregate value of negative equity was $309.5 billion at the end of Q2 2015, falling approximately $28.5 billion from $338 billion in Q1 2015. On a year-over-year basis, the value of negative equity declined overall from $350 billion in Q2 2014, representing a decrease of 11.6 percent in 12 months.
Own a home in MD or VA? Here’s where your equity stands:
If you own your home in VA, you rank among 91.2% of homeowners with positive equity.
If you own your home in MD, you rank among 87.9% of homeowners with positive equity.
Convergent forces are upon us. The force of positive equity is here and with us. Put the past behind you and look ahead to a prosperous, powerful, and happier real estate experience in 2016.
Contact Me! Let’s get your put together a plan to make this positive equity work for you.
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