One in three homes in the US were considered equity rich in Q3 2021 while one in 29 mortgages homes were considered seriously underwater.
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Increase in Equity-Rich US Homes in Q3 2021
According to ATTOM Data Solutions Q3 2021 US Home Equity & Underwater Report, 39.5% of mortgages residential properties were considered to be equity-rich.
What does “equity-rich” mean? The combined estimated amount of loan balances secured by these mortgaged residential properties was no more than 50% of these properties estimated market value.
This 39.5% portion of one in three mortgaged homes in the US was up from 34.4% in Q2 2021 and from 28.3% one year ago in Q3 2020.
Decrease in Seriously Underwater Homes in Q3 2021
This same report published by ATTOM indicated that only 3.4% of mortgaged homes, or one in 29 mortgaged homes, were considered to be seriously underwater in Q3 2021.
What does “seriously underwater” mean? The combined estimated balance of loans secured by these mortgaged residential properties was at least 25% more than the mortgaged property’s estimated market value.
This portion of one in 29 mortgaged homes was down from 4.1% in Q2 2021 and significantly down from 6%, or one in 17 properties, one year ago in Q3 2020.
Improvements at Both Ends of Equity Scale Accounted Large Equity Gains in Two Years
According to ATTOM, 46 of the country’s 50 states and the District of Columbia saw equity-rich levels rise from Q2 to Q3 2021. Likewise, seriously underwater portions of just one in 29 mortgaged homes, or 3.4%, dropped in 47 states including the District of Columbia.
Median home prices nationwide increased +4% quarterly and +16% y/y to a record high of $310,500. Though some signs of a possible market slowdown due primarily to declining home affordability, rising foreclosure rates and falling investor profits, equity and price gains during Q3 2021 are definitely examples of the housing market boom continuing to surge through ten consecutive years.
According to Todd Teta, chief product officer with ATTOM, “Homeowners across most of the United States could sit back with a smile yet again in the third quarter and watch their balance sheets grow as soaring home prices pushed their equity levels ever higher. Amid the best gains in two years, nearly 4 of every 10 owners found themselves in equity-rich territory.”
Thanks to ATTOM Data Solutions.