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Friday, December 09, 2022

Mortgage Equity Withdrawal Still Solid in Q3; Homeowners now relying on Home Equity lines to extract equity

by Calculated Risk on 12/09/2022 12:58:00 PM

Today, in the Real Estate Newsletter: Mortgage Equity Withdrawal Still Solid in Q3


Here is the quarterly increase in mortgage debt from the Federal Reserve’s Financial Accounts of the United States - Z.1 (sometimes called the Flow of Funds report) released today. In the mid ‘00s, there was a large increase in mortgage debt associated with the housing bubble.

Mortgage Equity WithdrawalIn Q3 2022, mortgage debt increased $209 billion, down from $258 billion in Q2, but still fairly high. Note the almost 7 years of declining mortgage debt as distressed sales (foreclosures and short sales) wiped out a significant amount of debt.

However, some of this debt is being used to increase the housing stock (purchase new homes), so this isn’t all Mortgage Equity Withdrawal (MEW).
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