As the housing market has continued its recovery, home prices have been climbing at a steady clip across the nation. And that means homeowners now have a nice stockpile of pent-up wealth in their homes.
In fact, as of the fourth quarter of last year, U.S. homeowners had a collective $5.7 trillion in tappable equity, according to Black Knight.
To break it down further, at the end of last year, homeowners amassed nearly $10,000 in equity in one year’s time, according to CoreLogic data.
But it seems fewer people are choosing to access this source of wealth.
Black Knight reported that just 1% of available equity tapped in the last quarter of 2018 –the lowest share since 2012.
That said, it is worth noting that cash-out refinances have seen some action in the last two years.
Freddie Mac data showed that the share of refinances that involved cash extraction climbed to 77% in the second quarter of 2018. But the amount of equity cashed out totaled $15.8 billion – well below the $75-$85 billion we saw in the years leading up to the crisis.