Home equity continued to improve in the first quarter of 2020, according to the latest Homeowner Equity Insights Report by the real estate data company CoreLogic. The report noted how the economic impact of the COVID-19 pandemic was not fully realized until the end of the period covered by the report, but that home prices—and the resulting equity improvements—remained robust during the period.

Compared to the first quarter of 2019, CoreLogic found that home equity in mortgaged properties was up by $590 billion – a year-over-year increase of 6.5 percent. CoreLogic says approximately 63 percent of all residences in the United States are mortgaged.

CoreLogic also offered a 10-year perspective on home equity changes, saying eight years of rising home prices have greatly benefited homeowners in the past decade. Between the first quarter of 2010 and the first quarter of 2020, CoreLogic determined that the aggregate value of home equity in the United States increased by $6.2 trillion, with the average homeowner seeing their equity value grow by $106,100.

"The pandemic recession will likely lead to price declines in many areas during the next year and weaken home equity gains. However, price declines will be far less than those experienced during the Great Recession, when the national CoreLogic Home Price Index fell 33 percent peak-to-trough," said Frank Nothaft, chief economist at CoreLogic. "Our latest forecast shows the national index to have a peak-to-trough decline of 1.5 percent."

Frank Martell, president and CEO of CoreLogic, said he expects the majority of homeowners to weather the current economic downturn without seeing a major impact to their home equity. He suggested that the low vacancy and delinquency rates, coupled with significant equity gains, will help preserve home values.

Many homeowners will experience a recession during their lifetime, and it is reasonable to compare the current recession to those in the past," said Martell. "But the comparison is not apples to apples – every recession is different. Primary drivers of the Great Recession were an overbuilt housing stock, risky mortgages, and the collapse of home prices, creating a massive increase in negative equity that proved difficult to recover from."

The average homeowner gained $9,600 in equity between the first quarter of 2019 and the first quarter of 2020. Homeowners in Idaho saw the greatest annual value boost, with an average gain of $24,400. This was followed by approximate gains of $21,000 in Washington, $20,000 in Arizona, and $18,000 in California.

Equity was largely unchanged in Alaska, and only up by an average of about $2,000 in Texas. Illinois, Iowa and New York homeowners had year-over-year gains of approximately $3,000, while those in Arkansas, North Dakota, and Oklahoma saw their average home equity increase by about $4,000.

About 1.8 million homes had negative equity, where the loans secured by the property are worth more than the market value of the home. This figure accounted for 3.4 percent of all mortgaged homes but was down by 16 percent from the fourth quarter of 2019, when 4.1 percent of properties—or about 2.2 million homes—were worth less than their loans.

Negative equity was most pronounced in Louisiana, where 9.6 percent of mortgaged homes were considered underwater. Other states with high negative equity shares included Connecticut (7.1 percent), Illinois (7 percent), and Iowa (6.1 percent).

Washington and Utah had the lowest negative equity shares at 1.4 percent each. In Oregon, the share stood at 1.5 percent.

The aggregate value of negative equity in the United States at the end of the first quarter of 2020 was $284 billion. This figure was down 0.7 percent from the previous quarter and 7.4 percent from the previous year.

CoreLogic equity reports are based on information from approximately 50 million financed properties, which the company says represents about 95 percent of all mortgaged homes in the nation. The reports use publicly recorded mortgage data as well as CoreLogic's valuation model and Home Price Index.