About one-in-four of the 55.2 million mortgaged homes in the United States during the second quarter were equity-rich, according to ATTOM Data Solutions’ 2020 U.S. Home Equity & Underwater Report.
The 15.2 million residential properties on which the combined estimated amount of loans secured by those properties was 50 percent or less of their estimated market value represented 27.5 percent, up from 26.5 percent in the first quarter of 2020, the report found.
The report said 3.4 million, or one-in-16, mortgaged homes in the second quarter of 2020 were considered seriously underwater, with a combined estimated balance of loans secured by the property at least 25 percent more than the property’s estimated market value.
That figure represented 6.2 percent of all U.S. properties with a mortgage, down from 6.6 percent in the prior quarter.
“Homeowners saw their equity rise far and wide throughout the United States during the second quarter of this year in yet another sign of the housing market punching back against the coronavirus pandemic,” ATTOM Chief Product Officer Todd Teta said in a release.
“More property owners rose into equity-rich territory and escaped the seriously underwater lane, putting more money into the average household,” Teta said. “The housing market still faces enormous challenges, given that unemployment remains historically high and the broader economy contracted severely in the second quarter. If that continues, owner equity will be seriously threatened. But for now, homeowners are enjoying the gains when it comes to what, for most, is their most significant asset.”
According to the report, 49 states and territories showed an increase in the percentage of homes considered equity-rich while just three showed an increase in the percentage that were seriously underwater. The Midwest and the South showed the biggest improvements in equity-rich homes.
ATTOM said the states with the biggest gains in the share of equity-rich homes were Georgia (20 percent equity-rich); Idaho (35.4 percent); Mississippi (21 percent); Indiana (25.2 percent); and Nebraska (19.9 percent).
The report identified the states with decreases or the smallest gains from the first to the second quarter in equity-rich properties as Hawaii, Delaware, New Jersey and North Dakota.
The states with the biggest declines in the percentage of homes considered seriously underwater were West Virginia, Mississippi, Georgia, South Dakota and Alabama.
The report said states where the percentage of seriously underwater homes rose or stayed the same in the second quarter included Hawaii, Indiana, Colorado, Oregon and Delaware.