Equity-Rich Portion of Mortgaged Homes Decreases While Seriously Underwater Level Rises;
Overall Equity for Homeowners Also Ticks Downward Amid Decline in Home Values;
But Nearly 95 Percent of Mortgaged Homeowners Still Have Equity Built Up
The portion of mortgaged homes that was equity-rich in the fourth quarter of 2023 decreased from 47.4 percent in the third quarter of 2023, marking the second straight quarterly decline. The latest figure also was down from 48 percent in the fourth quarter of 2022.
At the same time, the report shows that the portion of mortgaged homes that were seriously underwater in the
“There are increasing signs suggesting that the extended period of prosperity in the
The fourth quarter price decline capped off a year when the median home price grew annually by just 2 percent, marking the weakest growth since 2012 when the
The potential for more uneven equity trends remains in place as the housing market heads into its annual peak Spring and Summer buying season but faces elevated prices that remain a financial stretch for wide swaths of the potential buying public.
Equity-rich share of mortgages drops in most states
The portion of mortgages that were equity-rich decreased in 41 of the 50 U.S. states from the third quarter of 2023 to the fourth quarter of 2023, commonly by one to three percentage points. The biggest declines came in the Midwest and West regions, led by
At the other end of the scale, equity-rich levels rose in just nine states from the third quarter to the fourth quarter of last year, with the largest improvements concentrated in the Northeast region. The biggest increases were in
Seriously underwater mortgage levels up slightly in most states
The portion of mortgaged homes considered seriously underwater rose nationwide from one in 40 during the third quarter of 2023 to one in 38 during the fourth quarter. The ratio went up in 42 states, mostly by less than one percentage point.
The biggest increases were clustered in the Midwest and South, regions that already had some of the nation’s highest levels of seriously underwater mortgages. The largest quarterly increases were in
On the flip side, states where the percentage of seriously underwater homes decreased the most from the third to the fourth quarter of last year were
Highest levels of equity-rich homeowners still in Northeast and West
Nine of the 10 states with the highest levels of equity-rich mortgaged properties around the
Nine of the 10 states with the lowest percentages of equity-rich properties during the fourth quarter of 2023 were in the Midwest or South. The smallest portions were in
Among 107 metropolitan statistical areas around the nation with a population of at least 500,000, the West and South again dominated the list of places with the highest portion of mortgaged properties that were equity-rich. All but four of the top 25 metros were in those regions during the fourth quarter of 2023, led by
The 15 metro areas with the lowest percentages of equity-rich properties in the fourth quarter of 2023 were in the Midwest or South. The smallest levels were in
The portion of mortgaged homes considered equity rich declined from the third quarter of 2023 to the fourth quarter of 2023 in 80 of the 107 metro areas with sufficient data (75 percent) while the portion decreased from the fourth quarter of 2022 to the same period of 2023 in 67 percent.
Top equity-rich counties clustered in Midwest, Northeast and West
Among 1,738 counties that had at least 2,500 homes with mortgages in the fourth quarter of 2023, the top 30 equity-rich locations were in the Midwest, Northeast or West regions.
Counties with the highest share of equity-rich properties were
Counties with populations of at least 500,000 and the highest equity-rich rates were
Seventeen of the 20 counties with the smallest share of equity-rich homes in the fourth quarter of 2023 were in the South. The lowest were in
Counties with populations of at least 500,000 and the smallest equity-rich portions were
At least half of all mortgaged properties considered equity-rich in nearly 40 percent of zip codes
Among 9,081
Thirty-four of the top 50 zip codes were in
Largest shares of seriously underwater mortgages remain in Midwest and South
The Midwest and South regions had nine the top 10 states with the highest shares of mortgages that were seriously underwater in the fourth quarter of last year. The top five were
The smallest shares were in
Among 107 metropolitan statistical areas with a population greater than 500,000, those with the largest shares of mortgages that were seriously underwater in the fourth quarter of 2023 were
More than 20 percent of residential mortgages seriously underwater in just 36 zip codes
Among 9,081
The top five zip codes with the largest shares of seriously underwater properties in the fourth quarter of 2023 were 82716 in
Report methodology
The ATTOM
Definitions
Seriously underwater: Loan to value ratio of 125 percent or above, meaning the property owner owed at least 25 percent more than the estimated market value of the property.
Equity-rich: Loan to value ratio of 50 percent or lower, meaning the property owner had at least 50 percent equity.
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SOURCE ATTOM