US Homeowners Real Estate Wealth $28.7 trillion rpt trillion

 Americans are increasingly tapping their greatest source of wealth, getting home equity lines of credit to borrow against the value of their properties, which skyrocketed in the pandemic real estate rally. 

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One of the biggest perks of homeownership is the ability to build equity over time. You can use equity to secure low-cost funds in the form of a second mortgage—either a one-time loan or a revolving home equity line of credit (HELOC). 

https://www.investopedia.com/mortgage/heloc/

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Real estate prices have cooled slightly from the boom days, but most US homeowners have seen their properties appreciate rapidly, especially in popular spots such as Texas and Florida. 

Americans collectively had $28.7 trillion worth of home equity at the end of the first quarter, according to Black Knight Inc. 

That was down from the record high in the second quarter of 2022, but up from $20 trillion at the beginning of 2020.

Blooomberg 15 July 2023

https://www.bloomberg.com/news/articles/2023-07-15/rising-real-estate-prices-make-helocs-popular-for-owners-tapping-equity

The Fed’s hope, Doug Ramsey of The Leuthold Group said, lies in a behavioral economic theory called reverse wealth effect, in which consumers spend less as their wealth decreases. 

That should lead consumers to buy less stuff, particularly on big-ticket items like homes. And that should either prevent or at least slow the much-feared inflationary spiral.

Same goes for the US housing market

John Authers Bloomberg 26 oktober 2022 

https://englundmacro.blogspot.com/2022/10/the-feds-hope-lies-in-behavioral.html

Consumes and investors feel rich because they are rich.

Englund: Why the bulls are running and the consumers are buying (englundmacro.blogspot.com)