Homeowner Equity Roundup for 2022

There are few things in life better than building equity. As a brokerage, we’re sticking to that. Thankfully, we’re not the only ones. Each quarter, CoreLogic creates a Homeowner Equity Insight report to watch just how much equity is appreciating or depreciating on a quarter-to-quarter basis, and compare it to the year before. The big headline? Equity is on the rise. 

If you’re a homeowner (especially within the past couple of years) you’ve probably been raking in a huge amount of equity in a short time as a result of the changing market. If you’re still one of the 55% of renters living in Chicago making monthly payments that build nothing, it’s time to consider buying. The good news is the housing market in Chicago is being reported steadier than in other large cities and even as we see home prices drop a bit, owners are still seeing the value in their investments. Let’s get into it. 

The Big Picture

Corelogic analyzed U.S. homeowners with mortgages, about 63% of all properties, every quarter this past year and found with each report, total equity rose. In the first quarter, the increase was as large as $3.8 trillion since the first quarter of 2021, a gain of 32% year over year. In the second quarter, there was a slight drop to $3.6 trillion, a gain of almost 28% from the previous year. And this last quarter, we saw a larger drop to $2.4 trillion since the third quarter of 2021, a gain of almost 15% year over year. 

While the numbers may make it sound like equity is sharply slowing, things are still looking stellar for homeowners. In fact, they saw a record high during the second quarter at almost $300,000. 

“The quarter-over-quarter decline in equity is partially due to slowing home price growth across the country, as annual appreciation fell from about 18% in June to just slightly more than 10% in October,” Corelogic summarizes. “As home price gains are projected to relax into single digits for the rest of 2022, then possibly move into negative territory by the spring of 2023, equity increases will likely slow accordingly in some parts of the country.”

The Chicago Picture

While the housing market is up and down all over the country, experts have been pointing out that Chicago’s figures aren’t something to feel sour about. Crain’s Chicago Business reported Chicago-area single-family home values haven’t slowed nearly as much as in other major cities. In September 2022, for example, values were down just 1.8% points from September 2021 (still at 10% down overall). At the same time, Phoenix saw a 12.6% drop, San Diego 9.5%, Seattle down 6.2% and San Francisco down 2.3%. 

Furthermore, Chicago’s price growth on the list of 20 major U.S. cities has been steadily rising since, largely in part of other cities dropping below it. 

“[Chicago’s] home price growth has stayed relatively steady, another confirmation of the notion that because we didn’t ride the wave so high, we have less of a washout to worry about,” the article reports. 

This echoes other reports that are calling Chicago a relatively affordable market, with Lake County, Chicago, and Elgin all making the top ten list of U.S. markets “most likely to hold up best in 2023.” 

Chicagoland is a great place to start building equity. 

At the end of the day, experts agree the Chicago real estate market seems to be unlike other major cities. With steadier home growth and lower value drops than the rest of the country is seeing, Chicagoland is a perfect place to make an investment if you’re looking to build your home equity this year. The most important part is working with someone who can give you the full, real picture – as in, not just what we’ve seen the past two years, but what is normal for the location overall. Baird & Warner agents are uniquely positioned to give you the scoop and make the homebuying experience easier. Ready to start building equity of your own? Give us a call today.

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