According to ATTOM’s Home Equity & Underwater Report, 39.5 percent of mortgaged residential properties were considered equity-rich in the third quarter, up from 34.4 percent in the second quarter and from 28.3 percent a year ago.
The report also shows 3.4 percent of mortgaged homes, or one in 29, were considered seriously underwater in the third quarter, down from 4.1 percent in the second quarter and down from 6 percent, or one in 17 properties, a year ago.
“Homeowners across most of the United States could sit back with a smile yet again in the third quarter and watch their balance sheets grow as soaring home prices pushed their equity levels ever higher. Amid the best gains in two years, nearly four of every 10 owners found themselves in equity-rich territory,” ATTOM Chief Product Officer Todd Teta said in a release. “For sure, some uncertainty lies ahead as other key market barometers have been a bit shaky as of late. And the coronavirus pandemic remains a threat. But there is no doubt that homeowners continue benefitting big-time from the relentless home price increases we are seeing around the country.”
Across the country, 45 states, and the District of Columbia, saw equity-rich levels increase from the second quarter to the third quarter, while seriously underwater percentages decreased in 39 states. Year-over-year, equity-rich levels rose in 48 states, and the District of Columbia, and seriously underwater portions dropped in 46 states, and the District of Columbia.
Equity increases between July and September came as the median home price nationwide rose 4 percent quarterly and 16 percent year-over-year, to a new record of $310,500.
States where the equity-rich share of mortgaged homes rose the most from the second to third quarter were Utah (up from 45.5 percent to 60.9 percent); Arizona (up from 39.7 percent to 53.2 percent); Idaho (up from 54.2 percent to 65.1 percent); North Carolina (up from 28.4 percent to 38.6 percent); and Nevada (up from 34.9 percent to 44.9 percent).
The states where the equity-rich share of mortgaged homes decreased most from the second to the third quarter were Kansas (down from 31.4 percent to 27.1 percent); Wyoming (down from 29.5 percent to 25.8 percent); Mississippi (down from 26.6 percent to 23 percent); Montana (down from 40.8 percent to 38.5 percent); and California (down from 53.8 percent to 52.1 percent).
The states with the biggest second-to-third-quarter declines in the percentage of mortgaged homes considered seriously underwater were West Virginia (down from 11.7 percent to 7.1 percent); Ohio (down from 7.8 percent to 5.4 percent); Arkansas (down from 8.8 percent to 7 percent); Michigan (down from 5.4 percent to 3.7 percent); and Kentucky (down from 7.7 percent to 6.2 percent).
States where the percentage of seriously underwater homes rose most from the second to the third quarter were Mississippi (up from 7.6 percent to 17.7 percent); Wyoming (up from 3.6 percent to 11.5 percent); Maine (up from 3.4 percent to 5.8 percent); Kansas (up from 4.6 percent to 6.7 percent); and Montana (up from 3 percent to 3.6 percent).
The states with the highest levels of equity-rich properties in the third quarter included Idaho (65.1 percent of mortgaged homes were equity-rich); Vermont (61.2 percent); Utah (60.9 percent), Washington (56.2 percent); and Arizona (53.2 percent). States with the lowest percentages of equity-rich properties in the third quarter included Louisiana (19.8 percent); Illinois (21.5 percent); Alaska (23 percent); Mississippi (23 percent); and Oklahoma (24.7 percent).