U.S. HOMEOWNER EQUITY EASES SLIGHTLY IN Q4 2025 WHILE SERIOUSLY UNDERWATER RATES STAY NEAR HISTORIC LOWS

Nearly 45 Percent of Mortgaged Homes Remain Equity Rich Despite Quarterly Pullback; Seriously Underwater Share Edges Higher but Continues to Reflect Broad Equity Stability; Housing Market Shows Signs of Normalization Following Years of Rapid Appreciation

IRVINE, Calif., Feb. 3, 2026 /PRNewswire/ — ATTOM, the leading provider of property data, AI-powered analytics, and real estate intelligence solutions, today released its fourth quarter 2025 U.S. Home Equity & Underwater Report, which shows that 44.6 percent of mortgaged residential properties in the United States were considered equity-rich in the fourth quarter, meaning that the combined estimated amount of loan balances secured by those properties was no more than half of their estimated market values.

That level was down slightly from 46.1 percent in the third quarter of 2025 and off from the recent peak of 49.2 percent in the second quarter of 2024. Even so, the fourth quarter of 2025 marked the lowest share of equity rich properties since the fourth quarter of 2021.

On the other end of the spectrum, there was a modest uptick in seriously underwater properties. In the fourth quarter of 2025, 3.0 percent of mortgaged homes fell into that category, up from 2.8 percent in the third quarter, representing properties where combined estimated loan balances exceeded estimated market values by at least 25 percent.

“After years of rapid gains, homeowner equity is settling into a more sustainable range, and that’s not a negative sign for the market,” said Rob Barber, CEO at ATTOM. “Even with a modest pullback in equity-rich properties and a slight uptick in seriously underwater homes, overall equity levels remain remarkably strong by historical standards. As we move toward the spring buying season, these numbers suggest a housing market that is stabilizing rather than overheating, giving homeowners a solid financial foundation while allowing for healthier market dynamics.”

Table Summary 

From 2019 through 2022, the U.S. housing market experienced a sharp rise in homeowner equity, with the share of equity-rich mortgages climbing from about 27 percent to a peak near 49 percent as home values surged. Over the same period, seriously underwater rates fell by more than half, reaching historically low levels below 3 percent.  ATTOM’s Q4 2025 U.S. Home Equity & Underwater Report shows homeowner equity easing slightly from recent highs while the share of seriously underwater mortgages remains near historic lows.

Majority of states see equity-rich portion of home mortgages slip quarterly and annually

The portion of mortgaged homes that were equity-rich during the fourth quarter of 2025, 44.6 percent, remained far above the 26.5 percent level recorded in early 2020. While the latest figure was down in 42 of the 49 U.S. states from the third quarter to the fourth quarter of 2025, mostly by less than two percentage points, and down annually in 42 states.

The annual decreases were led by Florida (portion of mortgaged homes considered equity-rich decreased from 50.9 percent in the fourth quarter of 2024 to 43.9 percent in the fourth quarter of 2025), Kentucky (down from 38.5 percent to 32.1 percent), South Carolina (down from 46.7 percent to 40.9 percent), New Mexico (down from 49.6 percent to 44 percent) and Arizona (down from 50.9 percent to 45.4 percent).

On the opposite side of the spectrum, equity-rich levels increase slightly across a broad cross section of the U.S., with a concentration in the Northeast and Midwest but coverage across all major regions. The largest year-over-year increases during the fourth quarter of 2025 came in Alaska (up, year over year, from 31.5 percent to 33.5 percent), North Dakota (up from 32.4 percent to 33.7 percent), Illinois (up from 33 percent to 33.7 percent), South Dakota (up from 52.3 percent to 52.8 percent) and New York (up from 54.9 percent to 55.4 percent).

Seriously underwater mortgage rates remain largely stable across the U.S.

The share of mortgaged homes considered seriously underwater across the U.S. changed only marginally in the fourth quarter of 2025. At 3.0 percent, the rate edged up slightly from the prior quarter but remained near historically low levels, underscoring continued stability in homeowner equity positions nationwide.

The biggest annual improvements in seriously underwater mortgages came in North Dakota (share of mortgaged homes that were seriously underwater down from 4.7 percent in the fourth quarter of 2024 to 4.2 percent in the fourth quarter of 2025), South Dakota (down from 3.2 percent to 2.9 percent), Wyoming (down from 2.4 percent to 2.3 percent), and Idaho (down from 2.7 percent to 2.6 percent).

The largest year-over-year increases in the percentage of seriously underwater homes during the fourth quarter of 2025 were in Mississippi (up from 6.4 percent to 8.3 percent), Kentucky (up from 6.1 percent to 7.9 percent), District of Columbia (up from 3.2 percent to 4.4 percent), Louisiana (up from 9.5 percent to 10.7 percent) and Maryland (up from 2.6 percent to 3.7 percent).

Highest equity-rich rates cluster in the Northeast and West

In the fourth quarter of 2025, states posting the highest shares of equity-rich mortgaged homes were largely concentrated in the Northeast and West, highlighting the influence of higher home values and long term price growth in those regions. Vermont led the nation by a wide margin, with 87.0 percent of mortgaged homes classified as equity-rich, followed by New Hampshire (60.2 percent), Rhode Island (59.4 percent), Maine (58.1 percent), and Montana (57.3 percent). Other states with more than half of mortgaged homes equity-rich included New York, Massachusetts, Hawaii, California, and Idaho.

States with the lowest equity rich rates were more commonly found in the Midwest and South. Louisiana ranked last at 20.1 percent, with Maryland (28.4 percent), the District of Columbia (30.0 percent), Kentucky (32.1 percent), and Iowa (32.9 percent) also posting relatively low shares. Alaska, North Dakota, Illinois, and Oklahoma each recorded equity rich levels below 35 percent, underscoring regional disparities in homeowner equity across the country.

Overall, the Q4 2025 data points to a clear regional split, with higher cost coastal and Northeastern markets dominating the top tier, while many interior and Southern states remained toward the lower end of the spectrum, despite still retaining sizable equity cushions.

Top equity-rich counties again concentrated in Midwest

Among the 1,753 counties with at least 2,500 mortgaged homes in the fourth quarter of 2025, the counties with the highest shares of equity rich properties were concentrated primarily in the Midwest. Many of the top ranked locations were in Michigan and Wisconsin, alongside a smaller number in neighboring Midwestern states, reinforcing the region’s prominence among the nation’s most equity-rich counties.

Counties with the highest share of equity-rich properties were Benzie County (Beulah), MI (94.2 percent); Manistee County, MI (92.2 percent); Marquette, MI (91.8 percent); Chittenden, VT (91.1 percent); and Portage County (Stevens Point), WI (90.5 percent).

Counties with populations of at least 500,000 and the highest equity-rich levels were Santa Clara County (San Jose), CA (66.3 percent equity-rich); Orange County, CA (outside Los Angeles) (65.9 percent); San Mateo County, CA (64.1 percent); Nassau County, NY (63.8 percent); and Suffolk County, NY (63.1 percent).

The 20 counties with the smallest share of equity-rich homes in the fourth quarter of 2025 were overwhelmingly concentrated in the South, with a heavy clustering in Louisiana and additional representation across Mississippi, Kentucky, Georgia, South Carolina, Virginia, and Oklahoma. The lowest were in Vernon Parish (Leesville), LA (7.6 percent equity-rich); Lauderdale, MS (9.6 percent); Greenup County, KY (10.1 percent); Long County, GA (south of Savannah) (11.1 percent); and Finney County, KS (12 percent).

Counties with populations of at least 500,000 and the smallest equity-rich portions were Baltimore City/County, MD (22.2 percent equity-rich); Prince George’s County, MD (outside Washington, DC) (23.4 percent); Anne Arundel County, MD (outside Baltimore) (26.4 percent); Baltimore County, MD (27.5 percent) and District of Columbia (30 percent).

At least half of all mortgaged homes considered equity-rich in more than 30 percent of U.S. zip codes

Among 9,073 U.S. zip codes that had at least 2,000 residential properties with mortgages in the fourth quarter of 2025, there were 2,927 (32.3 percent) where at least half the mortgaged residential properties were equity-rich.

Among the top 50 zip codes, the largest share was concentrated in California, which accounted for 19, followed by Massachusetts with six, making those two states the most heavily represented overall.

Highest Seriously Underwater Mortgage Rates Concentrated in the Midwest and South

In the fourth quarter of 2025, states with the highest shares of seriously underwater mortgages were overwhelmingly concentrated in the Midwest and South. Nineteen of the 20 states with the largest seriously underwater rates were located in those two regions, led by Louisiana at 10.7 percent, followed by Mississippi (8.3 percent), Kentucky (7.9 percent), Iowa (5.8 percent), and Arkansas (5.6 percent).

By contrast, the lowest shares of seriously underwater mortgages were found largely in the Northeast and West. Vermont posted the smallest rate at 0.7 percent, with Rhode Island (1.0 percent), New Hampshire (1.2 percent), Massachusetts (1.3 percent), and California and New Jersey (both 1.7 percent) also among the states with the lowest seriously underwater levels.

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 2025 were Baton Rouge, LA (11.2 percent); New Orleans, LA (8.3 percent); Jackson, MS (6.5 percent); Lexington-Fayette, KY (6.3 percent); and Memphis, TN (6.0 percent).

More than 10 percent of residential mortgages seriously underwater in just a handful of zip codes

Among the 9,073 U.S. zip codes analyzed in the fourth quarter of 2025, there were only 252 locations (2.8 percent) where more than 10 percent of mortgaged properties were seriously underwater.

The top five zip codes with the largest shares of seriously underwater properties in the fourth quarter of 2025 were 67846 in Garden City, KS (52 percent of mortgaged homes); 22968 in Ruckersville, VA (42.3 percent): 19132 in Philadelphia, PA (35.3 percent); 53206 in Milwaukee, WI (28.7 percent); and 70601 in Lake Charles, LA (27.8 percent).

Report methodology

The ATTOM U.S. Home Equity & Underwater report provides counts of properties based on several categories of equity — or loan to value (LTV) — at the state, metro, county and zip code level, along with the percentage of total properties with a mortgage that each equity category represents. The equity/LTV is calculated based on record-level loan model estimating position and amount of loans secured by a property and a record-level automated valuation model (AVM) derived from publicly recorded mortgage and deed of trust data collected and licensed by ATTOM nationwide for more than 155 million U.S. properties. The ATTOM Home Equity and Underwater report has been updated and modified to better reflect a housing market focused on the traditional home buying process. ATTOM found that markets where investors were more prominent, they would offset the loan to value ratio due to sales involving multiple properties with a single jumbo loan encompassing all of the properties. Therefore, going forward such activity is now excluded from the reports in order to provide traditional consumer home purchase and loan activity.

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. 

About ATTOM

ATTOM powers innovation across industries with premium property data and analytics covering 158 million U.S. properties—99% of the population. Our multi-sourced real estate data includes property tax, deed, mortgage, foreclosure, environmental risk, natural hazard, neighborhood and geospatial boundary information, all validated through a rigorous 20-step process and linked by a unique ATTOM ID.

From flexible delivery solutions—such as Property Data APIs, Bulk File Licenses, Cloud Delivery, Real Estate Market Trends—to AI-Ready datasets, ATTOM fuels smarter decision-making across industries including real estate, mortgage, insurance, government, and more.

Media Contact:

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Megan.hunt@attomdata.com

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