Tacoma-Lakewood, WA (MSAD) Federal Housing Finance Agency Home Price Index (FHFA HPI)

The Tacoma-Lakewood, WA Federal Housing Finance Agency (FHFA) house price index (HPI) is a weighted, repeat-sales index measuring average price changes in single-family houses in the Tacoma-Lakewood metropolitan area. The HPI value for any given quarter is equal to 100 if the average home price during that quarter was equal to the price of the typical home during the base period of 1987:1. A value greater than 100 indicates that the average home price was above the typical home price during the base period; a value below 100 indicates that it was below.

The HPI for Tacoma-Lakewood peaked at 206.4 in 2nd quarter 2007 and then declined steadily to a trough of 124.8 in 1st quarter 2011. It has since risen modestly, reaching 133.2 in 4th quarter 2017 - an increase of about 7 percent from its trough but still about 36 percent below its peak (Exhibit 1).

Exhibit 1: FHFA House Price Index for Tacoma-Lakewood

Quarter HPI

1st Quarter 1987 100.0

2nd Quarter 2007 206.4

1st Quarter 2011 124.8

4th Quarter 2017 133.2

Home equity is defined as the market value of a homeowner's unencumbered interest in their real property—that is, the difference between the home's fair market value and outstanding mortgage debt on the property—and it can be used as collateral for a loan or line of credit with favorable loan terms because lenders view it as a low-risk investment due to its high loan-to-value ratio and lack of liquidity risk (the risk that an investor will not be able to find a buyer when they want to sell).

In other words, homeowners with equity can borrow against their homes at relatively low interest rates and use the proceeds for any purpose, such as funding home improvements or paying down high-interest debt like credit card balances or personal loans. And because home equity loans are secured by your house as collateral, they typically offer lower interest rates than unsecured loans such as personal loans or lines of credit from a bank—although this isn't always the case, so it's important to compare offers from multiple lenders before taking out any loan.

The amount of equity that homeowners have varies widely depending on factors such as location (equity is generally higher in markets where prices have appreciated more), how long they've owned their homes (equity builds over time as homeowners make mortgage payments and/or pay down their principal balance), and whether they have any outstanding mortgage debt (if so, their equity will be reduced by the amount they owe).

In general, though, we can say that most homeowners have some equity in their homes—even if it's just a small amount—and that this equity can be used to borrow money if needed.

According To CoreLogic's Equity Report for 2018 Q3, which uses data from public record information on first mortgages and deed recordings nationwide combined with data on consumer borrowing activity through Home Mortgage Disclosure Act filings, U.S households had an aggregate $15 trillion in tappable equity available at the end of September 2018 – up $560 billion from one year earlier and representing nearly 84% of all properties with a mortgage nationwide being "equity rich." This means that they had enough tappable equity available to pay off their entire mortgage balance plus cover additional expenses associated with selling their homes – including real estate commissions , transfer taxes , legal fees , etc.—and still have enough left over for themselves .

In other words , 84%of all mortgaged properties were worth more than what was owed on them ! That 's pretty incredible when you think about it . And while this number has been slowly ticking upward since 2013 , when it bottomed out at 77 % duringthe housing crisis / Great Recession , we are still well below pre - crisis levels ; in 2005 , 90 %of all mortgaged properties were considered "equity rich." So there 's still roomfor improvement .