Record-Breaking Surge In Online Searches For ‘HELOC’

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Record-Breaking Surge In Online Searches For ‘HELOC’

Aug 10, 2023 | News | 0 comments

Value Walk’s analysis of Google search trends found a 305% surge in HELOC searches in the US, reaching an all-time high in July 2023. This spike reflects concerns about escalating property expenses and a potential recession. RubyHome’s analysis supports this, highlighting a historic surge in Americans exploring HELOCs to manage debt or home improvements.

ValueWalk explains that a HELOC is a loan accessible to homeowners, relying on the accumulated equity in their property. Similar to a piggy bank, as the mortgage gets paid, equity grows. In need of funds, homeowners can tap into this equity through a HELOC, covering expenses such as home improvements or debt settlement, with interest paid solely on the borrowed amount.

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This coincides with the U.S. housing sector witnessing a surge of over 22% in mortgage rates compared to last year. Zillow’s data reveals an increase of 1.2% in the average American house price, reaching $348,853 compared to the previous year.

In his commentary on the findings, Tony Mariotti, the CEO of RubyHome, observed that homeowners who had made purchases a few years back at more budget-friendly prices and lower interest rates could be experiencing a conundrum. As they consider the prospect of acquiring a new home, they are acutely aware of the existing heightened real estate prices and the difficulty in obtaining an interest rate as exceptionally favorable as their current one.

Despite the higher rate associated with home equity loans, a minor loan for home enhancement continues to be advantageous for them. The combined rate of the HELOC alongside their primary mortgage remains lower than prevailing market rates for a fresh primary mortgage.