Fewer Connecticut residents ‘equity rich’
As the economic cycle nears its zenith, southwestern Connecticut continues to have lower ratios of homeowners who are “equity rich” in the houses they own through mortgage financing, according to an updated study this month by Attom Data Solutions.
Researchers with the Californiabased company calculated the number of property owners — in select ZIP codes on a town-by-town basis — who own outright at least half the equity value of their homes.
With the U.S. average at one in every four homeowners owning at least 50 percent of their mortgaged homes, in southwestern Connecticut only four communities beat that average — Greenwich, Darien, Westport and New Canaan — and only by slim margins.
Milford led Connecticut cities with about 22 percent of its residential mortgages paid down by at least half. Norwalk, Stamford and New Haven were only slightly behind, with Danbury further back at just 16 percent.
Bridgeport, Ansonia and Derby lie at the opposite end of the home-equity wealth equation in the southwestern corner of the state, with each city’s neighborhood studied by Attom having a ratio of less than 14 percent. Hartford had the lowest figure in the state, at less than 8 percent.
Nationally, the percentage of equity-rich properties dipped slightly from a five-year high at the close of 2018, with Attom having tracked the data since 2013. In the first three months of this year, California led the nation with 43 percent of its homes classified as equity rich, with San Jose, Calif., leading the nation at a 68 percent ratio.
New York held onto its thirdplace ranking among states after Hawaii, with about 34 percent of homeowners owning half the value of their homes or more.
While Connecticut banks have increased mortgage lending the past five years, they have steadily trimmed the weight those loans carry in their overall portfolios against commercial loans and other categories.
On a mid-April conference call, the CEO of Waterbury-based Webster Financial said the company is seeing declining demand in home lending, but anticipates a rebound this spring after signals by the Federal Reserve to keep interest rates in check. Subsidiary Webster Bank ranks second in Connecticut deposits after Bank of America, according to the Federal Deposit Insurance Corp.
“Just given general trends and ticks up in interest rates recently — and our disciplined view on pricing — we’ve seen mortgage, home equity and other consumer categories not grow as much,” Webster Financial CEO John Ciulla said, speaking in April. “I will tell you that, given the recent decline in long interest rates, ... we have seen our (mortgage) pipeline increase materially as we head into the second quarter.”