IRVINE, CA — New data from ATTOM’s first-quarter 2025 U.S. Home Equity & Underwater Report reveals that 46.2% of mortgaged residential properties were considered equity-rich, meaning the loan balances secured by these homes were no more than half of their estimated market value. While this reflects a slight drop from 47.7% in the fourth quarter of 2024, equity-rich rates remain nearly double what they were in early 2020.
The rate of seriously underwater homes, where loan balances exceed the property’s market value by at least 25%, ticked up from 2.5% in Q4 2024 to 2.8% in Q1 2025. Despite the slight rise, seriously underwater rates are significantly lower than the 6.6% seen in Q1 2020.
“Home equity rates are near their highest points in recent years, and the dip we’ve seen early this year in the proportion of equity-rich homes shouldn’t cause too much concern,” said Rob Barber, CEO for ATTOM. He noted that similar equity trends in the past two years have rebounded strongly in the second quarter.
Regional Trends in Equity-Rich Rates
The drop in equity-rich homes was widespread, with quarterly decreases in 47 states and the District of Columbia. Despite this, 33 states and D.C. experienced annual growth, showcasing the resilience of the housing market. States like Connecticut, New York, and New Jersey saw the most significant growth in equity-rich rates year-over-year, while Florida, Utah, and Arizona saw notable declines.
Nationally, the Northeast and West continue to lead in equity-rich homes. Vermont topped all states with 85.8%, followed by New Hampshire, Rhode Island, Montana, and Maine. Conversely, Louisiana, Maryland, and Illinois had the lowest equity-rich rates.
Among major metropolitan areas, San Jose, CA, led with 68.2% of mortgaged properties considered equity-rich, followed by Los Angeles, CA, at 64%.
Seriously Underwater Homes Show Stability
The proportion of seriously underwater homes remains consistent, averaging around 2-3% nationwide since early 2023. States in the South and Midwest, including Louisiana, Kentucky, and Mississippi, reported the highest proportions of seriously underwater homes. Meanwhile, Vermont and Rhode Island reported the lowest rates.
Implications for the Housing Market
Despite a slight quarterly dip in equity-rich homes, the long-term outlook for the U.S. housing market remains robust, with equity rates still near historic highs. The data indicates continued regional resilience and underscores the importance of monitoring local economic conditions to understand variations in homeowner equity.
As ATTOM continues to refine its data methodology, the housing market remains focused on traditional consumer home purchases, offering more accurate insights into trends impacting equity and home values across the country.
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