Finance

Home equity in US hits record $27.8 trillion

(File/Getty)

Total U.S. home equity reached a record high of $27.8 trillion, according to the Federal Reserve.

The ​​Fed reported that home equity increased by almost 20 percent in the first quarter of the year amid a booming housing market, The Wall Street Journal said.

The record setting home equity figures come as housing market prices skyrocket. The surge in prices, coupled with broader high inflation rates, has made it more difficult for people to use their equity, but on the other hand, it has bolstered the finances of Americans who already own houses, the newspaper added.

Recent research from Freddie Mac, the federal home loan mortgage corporation, indicated that low mortgage rates, limited supply and increased migration to the South and West as people seek more space have all contributed to the rising prices of homes.

Especially in places like Washington, D.C., Hawaii and Idaho, home values are currently up by well over 100 percent for each location since figures seen 20 years ago. 

Nationally, the typical U.S. home value is currently $344,141, according to Zillow’s home value index, which considers a middle price tier of homes. 

That figure marks an over 20 percent increase in the past year alone.  

But despite those high price tags, people have swarmed to purchase homes, especially amid the pandemic. 

“I will say in periods of uncertainty, whether it’s economic uncertainty or life uncertainty, this idea of real estate or home, I feel like is really compelling to people,” Lisa Sturtevant, a housing market analyst and consults Bright MLS, a listing service in D.C., said to The Washington Post

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