Homeowners' equity at lowest level in more than 50 years
Phoenix Business Journal - Adam Kress
With home values steadily dropping, a government report shows people have less and less equity in their homes.
The Federal Reserve Bank reported Thursday that homeowners' portion of equity slipped from 47.5 percent in fourth-quarter 2007 to 46.2 percent in first-quarter 2008 -- the lowest level since the Fed started tracking this data in 1945.
The number first dipped below 50 percent in the first quarter of 2007.
Because of the shrinking equity, people's net worth also is eroding.
The Fed report also found that Americans saw their net worth decline by $1.7 trillion in the first quarter. Overall, the net worth of U.S. households fell 3 percent, to $56 trillion, at the end of March.
That marks the second straight decline in net worth, which fell by more than $500 billion in the fourth quarter of 2007. Before then, net worth had risen steadily since 2003, climbing nearly 31 percent over those five years. During the bear market of 2000-02, average household net worth dropped 6.2 percent.
