American Institute for Economic Research
2008-03-05 08:00:00.0
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WASHINGTON -

The real value of residential real estate owned by Americans has increased from $834 billion to $5.1 trillion since 1952. In other words, in 1952 households owned roughly $667 billion worth of residential real estate.

Today they own more than $2.5 trillion (in constant dollars). ... In 1952, homeowners maintained just over 80 percent of the value of their homes in equity — the remainder financed by mortgage debt.

Home equity shares have sharply declined since, falling to a record low of 50.4 percent during the latest period for which data are available.

This share varies widely across households. Roughly one-third of all owner-occupied houses have 100 percent equity (i.e., are owned “free and clear”).

However, a decline in the share of a home’s value that is financed by equity does not mean that household equity has fallen.

Read more at aier.org.