Weakening prices from the most expensive metro areas caused the first decline in available equity since the market started recovering from the housing crisis, according to Black Knight.
Broken down individually, mortgage owners with at least 20% equity in their homes have an average of $136,000 in available equity to borrow, a quarter-over-quarter drop of about $2,300.
Overall, the market contains $9.8 trillion in home equity, $5.9 trillion of which is available for mortgage owners to borrow against. The available equity is a year-over-year increase of $571 billion from the third quarter of 2017.
"Indeed, tappable equity fell in 60 of the 100 largest markets, including 12 of the top 15. Three markets in California alone — San Jose, San Francisco and Los Angeles — accounted for 55% of the total net decline," Ben Graboske, executive vice president of Black Knight's data and analytics division, said in a press release.
"Add Seattle into the mix, and you see that just four markets were behind two-thirds of the net reduction in tappable equity. All were areas where home price growth has far outpaced the national average in recent years, but in which prices fell in 3Q 2018 — from as little as 1% in Los Angeles, to a 4.6% drop in San Jose," Graboske continued.
On the distressed front,
