T
he total value of owner-occupied real estate reached a record high of $48.2 trillion in the second quarter of 2024, surpassing the previous quarter's increase by $1.8 trillion and last year's gain by $3.5 trillion. This marks more than double the value of real estate from 10 years ago, which was between $20 trillion and $22 trillion.

    Mortgage debt continued to rise but at a slower pace, reaching $13.1 trillion in the second quarter with an annual growth rate of 2.6%, one of the lowest rates observed since 2020. Despite this slowdown, mortgage debt still surpassed its range from 2017 to 2019.

    Home equity reached a new high of $35.1 trillion in the second quarter, driven by the high value of real estate and an increase of $1.7 trillion from the previous quarter and $3.1 trillion from last year. Home equity as a proportion of real estate value stood at 72.7%, the highest level since 1960.

    The record-high home equity provides a substantial cushion to existing homeowners, with an average equity of around $267,000. Even if home prices were to decline by 10% or 20%, homeowner equity would still be significant, standing at 69.7% and 65.9%, respectively. However, slow price declines over the next two years could cause equity to dip further, but homeowners would still retain a substantial amount of equity, around 62.3%.