Key Highlights

  • Equity-rich properties continue to outnumber seriously underwater properties by 4:1
  • Portion of US homes considered equity-risk increases to 27.5% and seriously underwater properties decrease to 6%

In ATTOM Data Solutions’ Q2 2020 Home Equity & Underwater Report, equity rich residential properties (combined estimated amount of secured loans equaled 50% or less of estimated market value) represented 27.5% of the 55.2M mortgaged homes in the US. This 27.5% in Q2 was up from 26.5% in Q1 2020 despite the rambling economic fallout from the COVID pandemic.

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Additionally, this latest report indicates that just 3.4M or 1 in 16 mortgaged homes in the US during Q2 2020 were considered to be seriously underwater. These 3.4M seriously underwater homes (combined estimated balance of loans at least 25% more than the property’s estimated market value) represented 6.2% of all US properties with a mortgage, down from 6.6% in Q1 2020.

ATTOM indicated that its Q2 home equity snapshot reflects a strong but mixed housing market in the middle of a nationwide economic slowdown.

Todd Teta, ATTOM’s chief product officer, said, “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. More property owners rose into equity-rich territory and escaped the seriously underwater lane, putting more money in the average household.” That being said, Teta went on to communicate that “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.”

The Midwest and South had both the biggest improvements in the share of equity-rich and the biggest declines in underwater properties. States with the biggest gains in the share of equity-rich homes included Georgia, Idaho, Mississippi, Indiana and Nebraska. States with the smallest equity-rich gains included Hawaii, Delaware, New Jersey, Illinois and North Dakota.

The Northeast and West continued to be on top in terms of having the largest shares of equity-rich homes. California, Vermont, Hawaii, Washington state and Idaho had the highest shares of equity-rich properties while Louisiana, Oklahoma, Illinois, Arkansas and Alabama had the lowest percentages.

Nine of the top ten metros with the highest shares of equity-rich properties were in the West led by San Jose, San Francisco, Los Angeles, Santa Rosa and Seattle. Boston led in the Northeast, Dallas led in the South and Grand Rapids MI led in the Midwest. 93.5% of the metros showed increased levels of equity-rich properties while just 6.5% showed decreased levels of equity-rich properties.

The highest shares of seriously underwater properties again remained in the South and Midwest with the states of Louisiana, Mississippi, Iowa, West Virginia and Arkansas have the dubious honors of leading the pack.

Thanks to ATTOM Data Solutions.

Also read: Cities with Greatest Annual Home Seller Gains in Q2 2020, Some Startling Statistics about Small Business Revenues and Payrolls, People Ditching Big Cities for Smaller Suburbs & More Space

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