Return to The Money Mentor Blog

Home price trends reflect improving economy

June 16, 2015

By Alliant Credit Union

The Federal Reserve Board released data on June 11 indicating that U.S. households now own $99 trillion in assets. Even after we adjust that number to account for mortgages and other debt, Americans’ total net worth (assets minus liabilities) hit an all-time record of $84.5 trillion, with $21 trillion of that net worth in real estate.

If you’re a homeowner, it’s likely that you’ve seen the value of your home increase significantly in the last few years. That trend continues, and is reflected in the newly released April 2015 CoreLogic Home Price Index report. Home prices increased 2.7% vs March 2015. When we compare this April to last April, prices are up 6.8%. And according to MarketWatch, increasing home values have resulted in even bigger increases in the home equity of the average household, with equity increasing by $5.5 trillion since 2009. That’s a whopping 90% equity bump!

It’s no wonder, then, that Bloomberg recently declared that American consumers are getting their mojo back. That’s the headline from their report on the University of Michigan’s new consumer sentiment index showing Americans to be more upbeat about wage prospects than they’ve been for the past seven years.

Foreclosures & delinquencies down significantly
Trends related to home foreclosures and delinquencies also reflect positive momentum in the real estate market and in the economy overall. Frank Nothaft, chief economist for CoreLogic, said that “economic recovery, foreclosure alternatives and home-value gains have worked to reduce this inventory.”

CoreLogic’s April 2015 National Foreclosure Report showed foreclosure inventory had declined 24.9% since April of 2014. The number of mortgages that are in so-called “serious delinquency” (those 90+ days past due) has declined by 22.1% in the same period.