DQNews Archived Article

California's Equity Flood

by Real Estate Analyst John Karevoll
January, 1998

La Jolla, CA.— The value of California's housing stock increased by almost $106 billion last year, pouring welcome equity into homeowner finances, and contributing to the current flurry of borrowing activity, a real estate information service reported.

California's seven million homes were worth $1,398 billion at the end of 1997, up 8.2 percent from $1,292 the year before, according to DataQuick Information Systems.

The all-time high was reached in 1990 at $1,428 billion, the low of recent years was $1,256 billion in 1995 after several years of property value declines.

"About $10 billion a month is being added to the value of the state's housing stock right now and that number could double by the end of this year. That's a lot of potential business for lending institutions, and they're going after it aggressively," said Mike Ela, DataQuick president.

"Mailboxes are full of solicitations for home equity and refinance loans. And new loan types will even let homeowners jump the gun on equity increases, letting them borrow 125 percent or more of their home's value," he said.

DataQuick monitors real estate activity nationwide, and provides information to consumers, lending institutions, title companies and industry analysts.

The dollar volume figures above are arrived at by running an electronic appraisal of every home in the state, and then adding the market values up. Included are all properties that county tax assessor offices have designated as houses or condos. Ranch and other multi-use properties are not included. Newly-built homes are not included if they haven't been sold yet.

The increase in value of housing stock was steepest in Santa Clara, San Mateo, Santa Barbara and San Francisco counties — all of which had a more than 12 percent year-over-year rise. Central Valley housing stock increased in value by 2.3 percent in 1997, DataQuick reported.

Source: DataQuick Information Systems

Media Inquiries: John Karevoll (909)867-9534

Copyright © 1998 DataQuick Information Systems.
All rights reserved.

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