Half of Mortgaged Homeowners Once Again
Equity-Rich; Portion of Owners Seriously Underwater Drops to
Five-Year Low
IRVINE,
Calif., Aug. 1, 2024 /PRNewswire/ -- ATTOM, a
leading curator of land, property, and real estate data, today
released its second quarter 2024 U.S. Home Equity & Underwater
Report, which shows that 49.2 percent of mortgaged residential
properties in the United States
were considered equity-rich in the second quarter, meaning that the
combined estimated amount of loan balances secured by those
properties was no more than half of their estimated market
values.
The portion of mortgaged homeowners in equity-rich territory
during the second quarter of 2024 rose from 45.8 percent in the
first quarter of 2024, matching a high point reached in the Spring
of last year. The increase reversed a series of three straight
quarterly declines and marked one of the best gains in the past
five years.
While equity-rich levels improved, the report also reveals that
the portion of home mortgages that were seriously underwater in the
U.S. declined to 2.4 percent during the second quarter, or just one
in 42. That was down from 2.7 percent in the prior quarter to the
lowest level since at least 2019. Seriously underwater mortgages
are those with combined estimated balances of loans secured by
properties that are at least 25 percent more than those properties'
estimated market values.
The second-quarter equity gains came as home prices spiked
during the 2024 Spring buying season, with the median national
price shooting up 9 percent quarterly to a new record of
$365,000. Rising prices helped raise
equity levels throughout most of the country by widening the gap
between the estimated value of homes and the amounts homeowners
owed on their loans.
"Homeowner wealth took a notable turn for the better during the
second quarter as equity levels piggybacked on some of the biggest
home-price spikes we've seen in recent years," said Rob Barber, CEO for ATTOM. "After a period where
equity seemed stagnant or even declining, this brought another
boost of good news for homeowners from the enduring housing market
boom. Supplies of homes for sale remain limited these days and
buyer demand is typically elevated during the Summertime. So, it
should be no surprise if home values go even higher and take equity
along for the ride."
The latest market pattern reflects a period when the housing
market rebounded from several sluggish quarters of price gains and
losses. Values surged amid a tight supply of homes combined with
the usual Springtime increase in buyer demand. Additional help came
from relatively stable home-mortgage rates that hovered back and
forth around 7 percent for a 30-year fixed loan as well as a
national unemployment rate that fell below 4 percent and investment
markets that hit new highs.
Equity-rich shares of mortgages climb throughout
U.S.
The portion of mortgages that were equity-rich
increased in 48 of the 50 U.S. states from the first quarter of
2024 to the second quarter of 2024, commonly by more than two
percentage points. Measured annually, equity-rich levels were up in
31 states as the nationwide figure of 49.2 percent equity-rich in
the second quarter of this year matched the portion from the second
quarter of 2023.
The biggest quarterly increases came in lower-priced markets,
mainly across the South and Midwest regions, led by Kentucky (where the portion of mortgaged homes
considered equity-rich increased from 28.7 percent in the first
quarter of 2024 to 37.4 percent in the second quarter of 2024),
Illinois (up from 28.3 percent to
36.1 percent), Missouri (up from
38.3 percent to 45.5 percent), Oklahoma (up from 28.1 percent to 34.5
percent) and Alabama (up from 35.7
percent to 41.9 percent).
At the other end of the scale, equity-rich levels remained the
same in two states (staying at 54 percent in Utah and 51.5 percent in South Dakota). The smallest increases were in
North Dakota (up from 31.5 percent
to 32 percent), California (up
from 58.6 percent to 59.4 percent) and Louisiana (up from 20.1 percent to 21
percent).
Seriously underwater mortgage levels also improve in most
states
The portion of mortgaged homes considered seriously
underwater declined nationwide during the second quarter of 2024 to
one in 42. That was down from one in 37 in the first quarter of
2024 and one in 36 in the second quarter of last year – well below
the ratio of one in 15 recorded in 2019. The rate decreased in 47
states quarterly and 37 states annually.
As with rising equity-rich levels, the biggest decreases in
seriously underwater mortgages were clustered mainly in the South
and Midwest. The largest quarterly decreases were in Wyoming (share of mortgaged homes that were
seriously underwater down from 8.8 percent in the first quarter of
2024 to 2.5 percent in the second quarter of 2024), Kentucky (down from 8.3 percent to 6.3
percent), Illinois (down from 5.2
percent to 4 percent), Oklahoma
(down from 6.1 percent to 5 percent) and Alabama (down from 3.6 percent to 2.8
percent).
On the flip side, two states saw slight increases in the
percentage of seriously underwater homes from the first quarter to
the second quarter of 2024. They were Utah (up from 2.1 percent to 2.2 percent) and
South Dakota (up from 3 percent to
3.1 percent). The rate was unchanged in three states: New Mexico (2.6 percent), Kansas (2.9 percent) and Idaho (2.4 percent).
Largest levels of equity-rich homeowners still in
higher-priced markets of Northeast and West
The 10 states
with the highest levels of equity-rich mortgaged properties around
the U.S. during the second quarter of 2024 again were in the
Northeast or West regions. Those with the largest portions were
Vermont (83.5 percent of mortgaged
homes were equity-rich), Maine
(61.5 percent), New Hampshire
(61.1 percent), Montana (61.1
percent) and Rhode Island (60.2
percent).
Nine of the 10 states with the lowest percentages of equity-rich
properties during the second quarter of 2024 were in the Midwest or
South. The smallest portions were in Louisiana (21 percent of mortgaged homes were
equity-rich), Alaska (31 percent),
North Dakota (32 percent),
West Virginia (33.6 percent) and
Oklahoma (34.5 percent).
Among 107 metropolitan statistical areas around the nation with
a population of at least 500,000, upscale markets where median home
values topped $400,000 again
dominated the list of places with the highest portion of mortgaged
properties that were equity-rich during the second quarter. (See
ATTOM's latest Q2 2024 U.S. home sales report)
Those markets were led by San Jose,
CA (70.4 percent equity-rich, with a second-quarter median
home price of $1.6 million);
Miami, FL (65.4 percent, with a
median price of $485,000);
San Diego, CA (65.4 percent, with
a median price of $910,000);
Los Angeles, CA (65.3 percent,
with a median price of $963,500) and
Portland, ME (65.1 percent, with a
median price of $499,411).
The leader in the Midwest continued to be Grand Rapids, MI (57.2 percent equity-rich,
with a median price of $325,000).
The metro areas with the lowest percentages of equity-rich
properties in the second quarter of 2024 remained mostly in
low-priced markets of the South and Midwest. The smallest levels
were in Baton Rouge, LA (17.5
percent of mortgaged homes were equity-rich, with a second-quarter
median home price of $235,000);
New Orleans, LA (27.1 percent,
with a median price of $255,000);
Jackson, MS (29.2 percent, with a
median price of $262,421);
Virginia Beach, VA (30.3 percent,
with a median price of $329,000) and
Little Rock, AR (32.5 percent,
with a median price of $224,268).
The portion of mortgaged homes considered equity rich increased
from the first quarter of 2024 to the second quarter of 2024 in 99
of the 107 metro areas with sufficient data (93 percent), but was
still down from the second quarter of 2023 to the same period of
2024 in 57 percent.
Top equity-rich counties again concentrated in Midwest,
Northeast and West
Among 1,747 counties that had at least
2,500 homes with mortgages in the second quarter of 2024, the top
30 equity-rich locations were spread across the Midwest, Northeast
or West regions, with Michigan and
Vermont leading the way.
Counties with the highest share of equity-rich properties were
Chittenden County (Burlington), VT (90.8 percent equity rich);
Benzie County (Beulah), MI (89.2 percent); Manistee County, MI (86.6 percent);
Washington County (Montpelier), VT (86.3 percent) and
Marquette County, MI (85.4
percent).
Counties with populations of at least 500,000 and the highest
equity-rich levels were Santa Clara
County (San Jose), CA (71.4
percent equity-rich); Orange County,
CA (outside Los Angeles)
(69.9 percent); Palm Beach County
(West Palm Beach), FL (68.2
percent); Miami-Dade County, FL
(67.6 percent) and San Diego County,
CA (65.4 percent).
Nineteen of the 20 counties with the smallest share of
equity-rich homes in the second quarter of 2024 were in the South.
The lowest were in Vernon Parish
(Leesville), LA (5.4 percent
equity rich); Long County, GA
(south of Savannah) (9.2 percent);
Ascension Parish, LA (outside
Baton Rouge) (9.7 percent);
Acadia Parish, LA (outside
Lafayette) (10 percent) and
Arkansas County, AR (east of
Little Rock (10.7 percent).
Counties with populations of at least 500,000 and the smallest
equity-rich portions were Cook
County (Chicago), IL (34.8
percent equity-rich); Hennepin
County (Minneapolis), MN
(38.6 percent); Cuyahoga County
(Cleveland), OH (39 percent);
Philadelphia County, PA (40.6
percent) and New York County (Manhattan), NY (43.1 percent).
At least 50 percent of all mortgaged properties considered
equity-rich in almost half of all U.S. zip codes
Among 9,120
U.S. zip codes that had at least 2,000 residential properties with
mortgages in the second quarter of 2024, there were 4,263 (46.7
percent) where at least half the mortgaged properties were
equity-rich.
Among the top 50 zip codes, 41 were in California, Florida or Texas, including five each in Santa Barbara, CA, and Irvine, CA. The largest shares were in zip
codes 49855 in Marquette, MI (87.1
percent of mortgaged properties were equity-rich); 93110 in
Santa Barbara, CA (86.2 percent);
92657 in Newport Coast, CA (85.9
percent); 57702 in Rapid City, SD
(85.5 percent) and 76115 in Fort Worth,
TX (85.4 percent).
Largest shares of seriously underwater mortgages continue in
Midwest and South
The Midwest and South regions had 18 of
the top 20 states with the highest shares of mortgages that were
seriously underwater in the second quarter of this year. The top
five were Louisiana (10.5 percent
seriously underwater), Mississippi
(6.8 percent), Kentucky (6.3
percent), Arkansas (5.4 percent)
and Iowa (5.2 percent).
The smallest shares were in Vermont (0.7 percent seriously underwater),
Rhode Island (0.9 percent),
New Hampshire (1 percent),
Massachusetts (1.1 percent) and
California (1.2 percent).
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 second quarter of 2024 were
Baton Rouge, LA (11 percent);
New Orleans, LA (7.4 percent);
Jackson, MS (6.1 percent);
Little Rock, AR (4.7 percent) and
Lexington, KY (4.7 percent).
More than 20 percent of residential mortgages seriously
underwater in less than 1 percent zip codes
Among the 9,120
U.S. zip codes that had at least 2,000 homes with mortgages in the
second quarter of 2024, there were only 19 locations where more
than 20 percent of mortgaged properties were seriously
underwater.
The top five zip codes with the largest shares of seriously
underwater properties in the second quarter of 2024 were 39180 in
Vicksburg, MI (38.8 percent of
mortgaged homes were seriously underwater); 42445 in Princeton, KY (36 percent); 71446 in
Leesville, LA (33.4 percent);
44108 in Cleveland, OH (32.7
percent) and 44112 in Cleveland,
OH (30 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 provides premium property data to power
products that improve transparency, innovation, efficiency, and
disruption in a data-driven economy. ATTOM multi-sources property
tax, deed, mortgage, foreclosure, environmental risk, natural
hazard, and neighborhood data for more than 155 million
U.S. residential and commercial properties covering 99 percent of
the nation's population. A rigorous data management process
involving more than 20 steps validates, standardizes, and enhances
the real estate data collected by ATTOM, assigning each
property record with a persistent, unique ID — the ATTOM ID. The
30TB ATTOM Data Warehouse fuels innovation in many industries
including mortgage, real estate, insurance, marketing, government
and more through flexible data delivery solutions that
include ATTOM Cloud, bulk file licenses, property
data APIs, real estate market trends, property
navigator and more. Also, introducing our newest innovative
solution, making property data more readily accessible and
optimized for AI applications– AI-Ready Solutions.
Media Contact:
Megan
Hunt
megan.hunt@attomdata.com
Data and Report
Licensing:
datareports@attomdata.com
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