With home prices up in most markets, homeowners aren’t being shy about tapping into their newfound equity. Home equity lines of credit were up 18 percent in the first quarter, and up 14 percent from a year ago, according to ATTOM Data Solutions’ First Quarter U.S. Residential Property Loan Origination Report.
“Putting home equity to work is the name of the game in the 2018 housing market,” says Daren Blomquist, senior vice president at ATTOM Data Solutions, a real estate data firm. “With interest rates rising and home price appreciation accelerating, current homeowners are increasingly turning to home equity lines of credit rater than refinances to tap their home’s equity.”
Among 50 metro areas that were tracked (with populations of at least 1 million), the markets with the largest year-over-year increases in HELOC originations in the first quarter were: Hartford, Conn. (up 80%); Nashville, Tenn. (up 74%); Las Vegas (up 69%); Raleigh, N.C. (up 56%); and Indianapolis (up 51%).
“While there was early speculation that tax law changes related to home equity loans might dampen demand, that is not playing out in the market,” says Paul Doman, president and CEO of Accurate Group, which provides appraisal and title solutions for home equity lenders. “The strong HELOC growth in Q1 is consistent with the results of our March 2018 Home Equity Lender Survey, in which lenders were nearly unanimous in their belief that tax savings is not the primary driver for HELOC demand.”
Source: ATTOM Data Solutions
