More than 2 in 5 (41.9 percent) of mortgaged residential properties were considered equity-rich in the fourth quarter, according to ATTOM’s Home Equity and Underwater Report. That was up from 39.5 percent in the third quarter and from 30.2 percent a year earlier.
The report also shows that just 3.1 percent of mortgaged homes were considered seriously underwater in the fourth quarter, down from 3.4 percent in the third quarter and 5.4 percent a year earlier.
“Another quarter, another boost to the balance sheets of homeowners in most of the United States – that was the story from the fourth quarter of last year. As home prices kept rising, so did the equity built up in residential properties, to the point where close to half of all mortgage payers around the country found themselves in equity-rich territory,” ATTOM Chief Product Officer Todd Teta said in a release. “No doubt, there are market metrics that pose warnings about how long the boom can last and equity can keep improving. But for now, homeowners are sitting pretty as the wealth they have tucked away in their homes keeps growing.”
Across the country, 48 states saw equity-rich levels increase from the third to fourth quarter, while seriously underwater percentages decreased in 46 states. Year-over-year, equity-rich levels rose in 49 states, including the District of Columbia, as seriously underwater portions dropped in 48 states, again including the District of Columbia.
The West and South had 13 of the 15 states where the equity-rich share of mortgaged homes rose most from the third to fourth quarter of 2021. States with the biggest increases were Tennessee (up from 41.4 percent to 47.2 percent), North Carolina (up from 38.6 percent to 44.2 percent), Nevada (up from 44.9 percent to 49.8 percent), Georgia (up from 35.3 percent to 40.1 percent) and Arizona (up from 53.2 percent to 57.6 percent).
States where the equity-rich share of mortgaged homes decreased, or went up the least, from the third to fourth quarter were Wyoming (down from 25.8 percent to 24.5 percent), Connecticut (down from 30.6 percent to 29.7 percent), Kentucky (up from 30.9 percent to 31.3 percent), Alaska (up from 23 percent to 23.9 percent) and Illinois (up from 21.5 percent to 22.5 percent).
Fourteen of the 15 states with the biggest declines in the percentage of mortgaged homes considered seriously underwater from the third to fourth were in the South and Midwest. They were led by Mississippi (down from 17.7 percent to 12.2 percent), Maine (down from 5.8 percent to 4.4 percent), Iowa (down from 8.4 percent to 7 percent), West Virginia (down from 7.1 percent to 5.9 percent) and Arkansas (down from 7 percent to 5.9 percent).
States where the percentage of seriously underwater homes rose or declined the least from the third to fourth quarter were Wyoming (up from 11.5 percent to 14.3 percent), Connecticut (up from 3.8 percent to 4.3 percent), Arizona (up from 1.3 percent to 1.4 percent), Utah (up from 1.23 percent to 1.24 percent) and South Dakota (down from 4.61 percent to 4.6 percent).
The highest levels of equity-rich properties remained in the West during the fourth quarter. Nine of the top 10 states with the highest levels were led by Idaho (66.7 percent), Vermont (64.8 percent), Utah (62.5 percent), Washington (58.6 percent) and Arizona (57.6 percent).
Twelve of the 15 states with the lowest percentages of equity-rich properties in the fourth quarter were in the Midwest and South, led by Illinois (22.5 percent), Louisiana (22.5 percent), Alaska (23.9 percent), Wyoming (24.5 percent) and Mississippi (26.3 percent).