Leave a Message

Thank you for your message. We will be in touch with you shortly.

THE TRUE STRENGTH OF HOMEOWNERS TODAY

THE TRUE STRENGTH OF HOMEOWNERS TODAY
 
The real estate market is on just about everyone’s mind these days. That’s because the unsustainable market of the past two years is behind us, and the difference is being felt. The question now is, just how financially strong are homeowners throughout the country? Mortgage debt grew beyond 10 trillion dollars over the past year, and many called that a troubling sign when it happened for the first time in history.
 
Recently Odeta Kushi, Deputy Chief Economist at First American, answered that question when she said:
 
“U.S. households own $41 trillion in owner-occupied real estate, just over $12 trillion in debt, and the remaining ~$29 trillion in equity. The national "LTV" in Q2 2022 was 29.5%, the lowest since 1983.
 
She continued on to say:
 
“Homeowners had an average of $320,000 in inflation-adjusted equity in their homes in Q2 2022, an all-time high.
 

What Is LTV?

 
The term LTV refers to loan to value ratio. For more context, here’s how the Mortgage Reports defines it:
 
“Your ‘loan to value ratio’ (LTV) compares the size of your mortgage loan to the value of the home. For example: If your home is worth $200,000, and you have a mortgage for $180,000, your LTV ratio is 90% — because the loan makes up 90% of the total price.
 
You can also think about LTV in terms of your down payment. If you put 20% down, that means you’re borrowing 80% of the home’s value. So your LTV ratio is 80%.
 

Why Is This Important?

 
This is yet another reason we won’t see the housing market crash. Home equity allows homeowners to be in control. For example, if someone did need to sell their home, they likely have the equity they need to be able to sell it and still put money in their pocket. This was not the case back in 2008 when many owed more on their homes than they were worth.
 
Bottom Line
 
Homeowners today have more financial strength than they have had since 1983. This is a combination of how homeowners have handled equity since the crash and rising home prices of the last two years. And this is yet another reason homeownership in any market makes sense.

Recent Blog Posts

Why Buying a Home at the End of the Year Could Be Your Smartest Move

As an experienced realtor, I’ve seen all the ups and downs of the real estate market—and one thing that often goes overlooked is the unique opportunity presented by bu… Read more

Haunting Happenings in Morris County, NJ: Your 2024 Guide to Halloween Fun

As the leaves turn vibrant shades of orange and gold, Morris County, NJ, is gearing up for a Halloween season filled with frightful fun and festive activities for all … Read more

Hey Boo. It's Halloween in Union County NJ!

As the crisp autumn air rolls in and the leaves start to fall, Union County, NJ, is preparing for a Halloween season filled with thrilling events and festive activitie… Read more

Spooktacular Events in Essex County, NJ: Your Guide to Halloween 2024

As the leaves turn and the air cools, Essex County, NJ, is gearing up for a hauntingly good Halloween season in 2024. Whether you’re a resident or considering a move t… Read more

The Best Time To Buy a Home This Year

A shift is underway in the housing market this season. And if you’ve been sitting on the sidelines waiting for the right moment to jump back into your homebuying searc… Read more

2025 Housing Market Forecasts: What To Expect

Looking ahead to 2025, it’s important to know what experts are projecting for the housing market. And whether you’re thinking of buying or selling a home next year, ha… Read more

You Bought It. Now Maintain It.

Congratulations on your new home! Buying a house is a significant milestone and an exciting adventure.  However, homeownership comes with responsibilities, including m… Read more

111 To Do's To Buy A Home

So you're ready to buy a home. Here are 111 possible to do's to make your dream happen. Or, scroll to the end to see how to make the process so much easier.

ChatGPT Discover Essex County NJ This Summer: Festivals, Attractions, and More!

Welcome to Essex County, New Jersey, where summer comes alive with a vibrant array of festivals, attractions, water sites, music, and so much more.

Hey, before you go!

Want to stay one step ahead of the market? Sign up to be on Dyanna's VIP mailing list to receive exclusive listings, real estate news and a lot more.