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The Global Home Equity Lending Market size is estimated to grow by USD 35,535.04 million between 2022 and 2027 accelerating at a CAGR of 3.81%.
This home equity lending market report extensively covers market segmentation by source (mortgage and credit union, commercial banks, and others), distribution channel (offline and online), and geography (North America, Europe, APAC, South America, and Middle East and Africa). It also includes an in-depth analysis of drivers, trends, and challenges.
The growth of the market depends on several factors, including massive increases in home prices, benefits of a home equity loan, and tax deductions for interest payments.
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Our researchers analyzed the data with 2022 as the base year and the key drivers, trends, and challenges. A holistic analysis of drivers will help companies refine their marketing strategies to gain a competitive advantage.
The massive increase in home prices is a major factor driving the market home equity lending market. House prices rose by more than 5% in most countries in 2020. The top countries that witnessed the highest increase are Luxembourg, Turkey, New Zealand, and Canada. Leading the surge were cities in North America, where housing prices increased 15% on average. Cities in the APAC region lagged, registering an average 9% annual price increase, according to the agency's Global Residential Cities Index in Q4 2021. As property prices continue to grow, homeowners will be able to access the reserve as they become more equity rich. A rise in the property's price will provide a big enough margin to get a loan against it because home equity loans are secured as the market value of the property increases. Thus, homeowners are anticipated to use home equity loans more during the forecast period leading to the growth of the market in focus.
An increase in residential properties is a major home equity lending market trend. The growing population, the growing need for decent housing and infrastructure, and the tendency toward nuclear families are aiding residential infrastructure development. Because of the increased need for both residential and commercial areas, the housing sector has recently experienced remarkable expansion. In contrast to customary practice, the COVID-19 pandemic in 2020 has caused a cultural shift in enterprises and among employees towards a higher acceptance of remote work, including working from home. This has encouraged more home buyers to opt for larger homes, which has increased housing demand. In India, urban regions currently lack 10 million housing units, and it is predicted that by 2030, 25 million affordable housing units will be needed to accommodate the countrys growing urban population. Thus, such factors will drive the growth of the global home equity lending market during the forecast period.
Fear of losing property and fear of home security is a major home equity lending market challenge faced by many. The entire home equity lending process takes anywhere from two weeks to two months. A few factors influence the timeline. The lender checks copies of the consumers current mortgage statement, property tax bill, and proof of income. If these are not readily available, it might take the lender longer to process the application. The lender will also review consumers credit scores, debt-to-income (DTI) ratio, and other financial details. The lender will hire a licensed, third-party appraiser to confirm the consumers homes value. If the appraiser is busy, this phase could take longer than expected. Some states mandate that an attorney be present when a loan is closed. If so, the closing may be postponed if you have to accommodate your attorneys hectic schedule. Such factors may challenge the growth of the global home equity lending market during the forecast period.
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The market share growth of the mortgage and credit union segment will be significant during the forecast period. Mortgage and credit union is the smart choice for home equity lending. To prevent scams and get a reasonable rate, consumers need a reliable lender for home equity lending. There are many services that mortgage and credit unions provide. In addition to offering consumer loans, credit unions accept deposits, manage checking and savings accounts, dispense credit and debit cards, and provide house loans.
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The mortgage and credit union segment was valued at USD 76,630.25 million in 2017 and continued to grow until 2021. Credit unions offer simple-to-use services and live human beings who can respond to inquiries, offer advice, and help understand the complex world of finance. Credit unions provide some of the cheapest rates on credit products such as mortgages. They provide fee-free checking accounts as well as savings accounts without a high minimum balance. Such factors will contribute to mortgage and credit unions segment growth during the forecast period leading to market growth.
Mortgage and credit unions are the wise choice for home equity lending, ensuring fair rates and avoiding scams. These institutions offer a range of services, including consumer loans, deposits, checking and savings accounts, credit and debit cards, and home loans. Credit unions provide user-friendly services and human support for financial guidance. To help a buyer renovate the house at times they provide interior design services as well. With some of the lowest rates for mortgages and no-fee checking and savings accounts, credit unions offer valuable benefits to home buyers. These factors will positively effect the market growth.
North America is estimated to contribute 37% to the growth of the global market during the forecast period. Technavio’s analysts have elaborately explained the regional trends and drivers that shape the market during the forecast period.
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North America holds a major share in the global home equity lending market in 2022. Due to a significant rise in home prices, banks and credit unions now have a significant growth opportunity in home equity loans and lines of credit (HELOC). Canadians are increasingly using their homes as collateral for loans as a result of rising real estate values and fewer regulations. The Federal Housing Finance Agency (FHFA) house price index data show that between Q1 2021 and Q1 2022, US home prices climbed by 18%. Such factors will contribute to the growth of the regional home equity lending market during the forecast period.
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The increased prevalence of COVID-19 adversely impacted the growth of the market in the region in 2020. However, homeowners are looking to update their spaces and invest in the locations where they spend the majority of their time because so many Americans work from home, exercise at home, and attend school from home. Many people who have just bought a new house are trying to figure out how to make it feel more like a home, like buying a couch to fit the new living room. Such factors are expected to increase the demand for home equity lending during the forecast period leading to growth in the regional home equity lending market.
Vendors are implementing various strategies, such as strategic alliances, partnerships, mergers and acquisitions, geographical expansion, and product/service launches, to enhance their presence in the Home Equity Lending Market. One of the major vendor in the market include:
U.S. Bancorp - The company offers home equity lending which is suitable for home improvements, debt consolidation, weddings and celebrations, and education as its key offerings under its commercial banking segment. Through this segment, the company offers lending, equipment finance and small-ticket leasing, depository services, treasury management, capital markets services, international trade services and other financial services to middle market, large corporate, commercial real estate, financial institution, non-profit, and public sector clients.
The report also includes detailed analyses of the competitive landscape of the market and information about 15 market vendors, including:
Qualitative and quantitative analysis of vendors has been conducted to help clients understand the wider business environment as well as the strengths and weaknesses of key market players. Data is qualitatively analyzed to categorize vendors as pure play, category-focused, industry-focused, and diversified. Furthermore, it is also quantitatively analyzed to categorize vendors as dominant, leading, strong, tentative, and weak.
The market research report forecasts market growth by revenue at global, regional & country levels and provides an analysis of the latest trends and growth opportunities from 2017 to 2027.
Home Equity Lending Market Scope |
|
Report Coverage |
Details |
Page number |
150 |
Base year |
2022 |
Historic period |
2017-2021 |
Forecast period |
2023-2027 |
Growth momentum & CAGR |
Accelerate at a CAGR of 3.81% |
Market growth 2023-2027 |
USD 35,535.04 million |
Market structure |
Fragmented |
YoY growth 2022-2023(%) |
3.61 |
Regional analysis |
North America, Europe, APAC, South America, and Middle East and Africa |
Performing market contribution |
North America at 37% |
Key countries |
US, China, Japan, Germany, and France |
Competitive landscape |
Leading Vendors, Market Positioning of Vendors, Competitive Strategies, and Industry Risks |
Key companies profiled |
A and A Dukaan Financial Services Pvt. Ltd., ABC Finance Ltd., Australia and New Zealand Banking Group Ltd., Bank of America Corp., Barclays PLC, Citizens Commerce Bancshares Inc., Commonwealth Bank of Australia, Flagstar Bancorp Inc., HSBC Holdings Plc, JPMorgan Chase and Co., Morgan Stanley, Navy Federal Credit Union, nbkc bank, Pentagon Federal Credit Union, Police and Nurses Ltd., Regions Financial Corp., State Bank of India, The Goldman Sachs Group Inc., The PNC Financial Services Group Inc., and U.S. Bancorp |
Market dynamics |
Parent market analysis, Market growth inducers and obstacles, Fast-growing and slow-growing segment analysis, COVID 19 impact and recovery analysis and future consumer dynamics, Market condition analysis for forecast period |
Customization purview |
If our report has not included the data that you are looking for, you can reach out to our analysts and get segments customized. |
We can help! Our analysts can customize this report to meet your requirements. Get in touch
1 Executive Summary
2 Market Landscape
3 Market Sizing
4 Historic Market Size
5 Five Forces Analysis
6 Market Segmentation by Source
7 Market Segmentation by Distribution Channel
8 Customer Landscape
9 Geographic Landscape
10 Drivers, Challenges, and Trends
11 Vendor Landscape
12 Vendor Analysis
13 Appendix
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