About 17.8 million homes in the United States were equity-rich in the first quarter of 2021, according to the latest figures from Attom Data Solutions.
That’s 31.9% — roughly one in three — of the 55.8 million mortgaged residential properties in the country, per the company’s first quarter 2021 U.S. Home Equity & Underwater Report. That’s up from 26.5% in the first three months of 2020 and continues a steady quarterly rate of growth from 28.3% and 30.2% in the previous two quarters.
Rising equity is yet another sign that, despite the global economic havoc caused by the COVID-19 pandemic, the U.S. housing market has been markedly hardy. Equity has continued to grow thanks to soaring home prices, which have helped widen the gap between the value of homeowners’ properties and what they owe on the mortgages.
Equity gains were geographically broad-based, with forty-one states showed a quarterly increase in the percentage of homes considered equity-rich.
“It continues to be a great time to be a homeowner most everywhere in the country,” said Todd Teta, chief product officer with ATTOM Data Solutions. “The ongoing price spikes we’re seeing help to cut down the number of seriously underwater properties and boost the level of equity-rich properties.”
Meanwhile, Attom found that just 2.6 million — about one in 21 — mortgaged residential properties were seriously underwater in the first quarter, with a combined balance of loans on the property at least 25% more than its estimated value.
That number of properties represents approximately 4.7% of all mortgaged homes in the country, down from 6.6% one year ago and 5.4% one quarter prior.
Teta did note that, despite current strength in equity trends, the market bears watching once the end of the foreclosure moratorium is reached.
“[National equity growth] may shift once the foreclosure moratorium is lifted and that’s something we’re watching, partly because it could limit equity gains and draw people underwater,” he said. “For now, though, the equity picture remains one of many signs that the long U.S. housing market boom keeps charging ahead.”