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U.S. Homeowners Remain Four Times as Likely to Be Equity-Rich than Seriously Underwater

14.5 million residential properties in the United States were considered equity-rich, meaning the combined estimated amount of…

  • June 7, 2020

14.5 million residential properties in the United States were considered equity-rich, meaning the combined estimated amount of loans secured by those properties was 50 percent or less of their estimated market value, according to property data provider ATTOM Data Solutions

ATTOM Data Solutions has released its first-quarter 2020 U.S. Home Equity & Underwater Report.

The count of equity-rich properties in the first quarter of 2020 represented 26.5 percent, or about one in four, of the 54.7 million mortgaged homes in the U.S.

That percentage was down slightly from the 26.7 percent level in the fourth quarter of 2019.

The report also shows that just 3.6 million, or one in 15, mortgaged homes in the first 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 6.6 percent of all U.S. properties with a mortgage, up slightly from 6.4 percent in the prior quarter.

The figures were derived from the last data recorded before the economic fallout from the Coronavirus pandemic began to sweep across the U.S., potentially damaging the nation’s housing market.

Highest equity-rich shares remain in the Northeast and West

The top 10 states with the highest share of equity-rich properties in the first quarter of 2020 were all in the Northeast and West regions, led by California (42.3 percent equity-rich), Hawaii (39.0 percent), Vermont (38.2 percent), Washington (36.6 percent) and Oregon (34.0 percent).

States with the lowest percentage of equity-rich properties were Louisiana (13.5 percent equity-rich), Oklahoma (14.7 percent), Illinois (15.2 percent), Arkansas (16.3 percent) and Alabama (16.3 percent). Those were the same states with the five lowest levels in the fourth quarter of 2019.

Among 107 metropolitan statistical areas analyzed in the report with a population greater than 500,000, those top 5 metro areas with the highest shares of equity-rich properties in the first quarter of 2020 were all in California: San Jose (64.8 percent equity-rich), San Francisco (57.0 percent), Los Angeles (47.4 percent), Santa Rosa (45.5 percent) and San Diego (40.0 percent). The leader in the Northeast region again was Boston, MA, (34.8 percent) while Dallas-Fort Worth, TX, again led the South (36.6 percent) and Grand Rapids, MI, continued to lead in the Midwest (26.4 percent).

Metro areas with the lowest percentage of equity-rich properties were Baton Rouge, LA (10.3 percent equity-rich); Columbia, SC (13.5 percent); Little Rock, AR (13.6 percent); Tulsa, OK (13.8 percent) and Dayton, OH (14.5 percent).

Among the 107 metro areas, 38 metro areas (35.5 percent) showed an increase in levels of equity-rich properties from the fourth quarter of 2019 to the first quarter of 2020; while 69 metro areas (64.5 percent) showed a decrease.

Highest seriously underwater shares remain in the South and Midwest

The top 10 states with the highest shares of mortgages that were seriously underwater in the first quarter of 2020 were all in the South and Midwest regions, led by Louisiana (17.3 percent seriously underwater), Mississippi (16.9 percent), West Virginia (15.7 percent), Iowa (14.2 percent) and Arkansas (13.0 percent).

Among the 107 metropolitan statistical areas analyzed in the report with a population greater than 500,000, those with the highest share of mortgages that were seriously underwater in the first quarter of 2020 were Youngstown, OH (17.0 percent); Baton Rouge, LA (16.4 percent); Scranton, PA (14.5 percent); Toledo, OH (14.3 percent) and Cleveland, OH (13.7 percent).

Among the 107 metro areas, 65 metro areas (60.7 percent) showed an increase in levels of underwater properties from the fourth quarter of 2019 to the first quarter of 2020; while 42 metro areas (39.3 percent) showed a decrease.