ATTOM has released its second quarter 2026 U.S. Home Equity & Underwater Report, which shows that 41.1 percent of mortgaged residential properties in the country were equity-rich, meaning the combined estimated amount of loan balances secured by those properties was no more than half of their estimated market value. That was down from 43.3 percent in the first quarter of the year and from 47.4 percent in the second quarter of 2025. After four straight quarters of decline, the national share of equity-rich homes is at its lowest point in nearly five years. Meanwhile, 3.2 percent of properties in the second quarter of 2026 were considered seriously underwater, meaning the combined estimated balances of loans secured by the properties were at least 25 percent more than the properties’ estimated market value. That was the same rate as the previous quarter, but up from 2.7 percent at the same time last year. “These two measures of home equity strength, the rates of equity-rich and seriously underwater homes, remain healthier than they were prior to 2020,” said Rob Barber, CEO of ATTOM. “However, both have been moving in less favorable directions over the past year, suggesting a trend worth watching.” Four states saw rates of equity-rich homes rise  The share of equity-rich homes rose in 13 states quarter-over-quarter but just four states year-over year. The states that experienced year-over-year increases in their shares of equity-rich homes were North Dakota (up from 30.2 percent to 32.9 percent equity-rich); South Dakota (up from 52.1 percent to 53.6 percent); Kentucky (up from 35.1 percent to 36.5 percent); and Wyoming (up from 45.3 percent to 46.6 percent). The states with the largest annual drops in their shares of equity-rich homes were Minnesota (down from 37.6 percent to 20.1 percent equity-rich); Michigan (down from 50.8 percent to 39.3 percent); California (down from 56.9 percent to 45.6 percent); Washington (down from 52.4 percent to 43.2 percent); and Missouri (down from 46.1 percent to 37.8 percent). In the second quarter of 2026, the states with the highest proportions of equity-rich homes were Vermont (78.9 percent); Montana (59 percent); Rhode Island (54.9 percent); South Dakota (53.6 percent); and New Hampshire (53.1 percent). Seriously underwater rate shoots up in Minnesota  The proportion of seriously underwater homes rose in 18 states quarter-over-quarter and in 33 states and the District of Columbia year-over-year. The states with the largest annual increases in their rates of seriously underwater homes were Minnesota (up from 2.6 percent to 12.1 percent of homes seriously underwater); South Dakota (up from 3.1 percent to 5.7 percent); Iowa (up from 5.9 percent to 7.8 percent); Michigan (up from 2.5 percent to 4 percent); and the District of Columbia (up from 3.7 percent to 5 percent). The states with the biggest year-over-year drops in their rates of seriously underwater homes were Louisiana (down from 11.9 percent to 10.3 percent); Kentucky (down from 7 percent to 5.7 percent); North Dakota (down from 5 percent to 4 percent); Oklahoma (down from 5.6 percent to 4.7 percent); and New York (down from 2 percent to 1.5 percent). In the second quarter of 2026, the states with the highest rates of seriously underwater homes were Minnesota (12.1 percent); Louisiana (10.3 percent); Iowa (7.8 percent); Mississippi (6.4 percent); and Arkansas (6 percent). Nearly all big metros lost share of equity-rich homes year-over-year  The share of equity-rich homes was down quarter-over-quarter in 67.6 percent (73) of the 108 metropolitan statistical areas in ATTOM’s analysis, which included metros if they had populations of at least 500,000 and sufficient data to analyze. Year-over-year, the share of equity-rich homes was down in 96.3 percent (104) of those metro areas. The metro areas with the highest rates of equity-rich homes in the second quarter of 2026 were San Jose, CA (59.1 percent); Portland, ME (56.4 percent); New York, NY (54.7 percent); Buffalo, NU (54.4 percent); and Providence, RI (53.1 percent). The metros with the lowest rates of equity-rich homes for the quarter were Baton Rouge, LA (15.4 percent); Minneapolis, MN (16.9 percent); Fresno, CA (18.1 percent); New Orleans, LA (19.9 percent); and Richmond, VA (22.1 percent). On the other end of the spectrum, the metros with the highest rates of seriously underwater homes were Minneapolis, MN (13.4 percent); Fresno, CA (10.9 percent); Baton Rouge, LA (10.9 percent); New Orleans, LA (8.5 percent); and Richmond, VA (6.7 percent). Wide disparities in equity-rich rates between counties  Among counties with sufficient data to analyze, those with the highest shares of equity-rich homes in the second quarter of 2026 were Park County, MT (94.7 percent); Codington County, SD (92.2 percent); Lawrence County, SD (89 percent); Marquette County, MI (86.4 percent); and Chittenden County, VT (86.3 percent). The counties with the smallest shares of equity-rich homes were Saint Bernard Parish, LA (10.8 percent); Sherburne County, MN (12.6 percent); Iberville Parish, LA (12.7 percent); Bossier Parish, LA (12.8 percent); and Long County, GA (13.3 percent). Shrinking share of zip codes have at least 50 percent equity-rich homes  In the second quarter of 2026, at least half of all mortgaged homes were equity-rich in 21 percent (1,861) of the 8,865 zip codes with sufficient data to analyze. The zip codes with the highest rates of equity-rich properties were 59047 in Livingston, MT (94.8 percent); 57201 in Watertown, SD (92.3 percent); 57783 in Spearfish, SD (90.4 percent); 57702 in Rapid City, SD (88.8 percent); and 49855 in Marquette, MI (87.9 percent). Conclusion  The Q2 2026 U.S. Home Equity and Underwater Report found that the nation’s share of equity-rich homes continued to shrink to 41.1 percent, near a five-year low. The nationwide rate of seriously underwater homes stayed level quarter-over-quarter, but has risen consistently over the last year.

Buying a home is a financial commitment measured not just in dollars, but in years. Whether to buy or rent is a complex question that depends on where you want to live and your lifestyle preferences, in addition to your financial situation. Nationwide, a median-income household can save for a down payment and break even on their purchase in less than 15 years, compared to renting, according to a new Zillow® analysis.  To measure how long a potential buyer should expect to wait until buying makes more financial sense than renting, Zillow looked at how long it takes to save for a down payment, then come out ahead financially compared to renting a single-family home. Nationally, a household saving 10% of the median income needs 8.5 years to save enough to put 20% down on the typical single-family home, then another 6.2 years before the investment pays off relative to renting.  The numbers vary widely market by market. Memphis has the shortest timeline at just under 11 years, with Pittsburgh, Detroit and Indianapolis showing similar numbers. That puts a four-year college graduate on track to cross that threshold by their mid-30s. But in the most expensive markets — like California's major markets — that timeline may mean you need to age in place in your first home. San Jose has the longest timeline at nearly 50 years.  "The common wisdom is that saving early to buy a home is the smart financial move, but the reality is more nuanced," said Kara Ng, senior economist at Zillow. "The breakeven number tells you something about a market that a price tag alone doesn't. Buyers should think about not just when they can afford to buy, but how long they'd need to stay before owning makes more financial sense than renting. Homeownership comes with equity and stability, while renting offers flexibility and freedom from maintenance bills and emergencies."  The years add up differently depending on where you live Not every timeline follows the same path. A typical household in Austin can save for a down payment after about eight years — faster than the national figure. But because rents have fallen in the area and are relatively affordable, that same buyer needs another 18 years to break even compared to renting, nearly triple the national average. Meanwhile, a typical Miami household needs five more years to save for a down payment than in Austin, but roughly half the time to break even once it does. The result is that Miami buyers reach the finish line about three years ahead of Austin buyers, despite the longer wait to buy a home.  This split matters for how potential buyers should interpret these numbers. A long timeline in one market may reflect affordability challenges across the board, while in a market like Austin it represents a more significant financial tradeoff when jumping into homeownership while the rental market is friendly.  The starter home dilemma One way to shorten the clock is to target a starter home, defined by Zillow as the average home in the lowest one-third of home values in a given region. Nationwide, it takes half the time — 7.2 years — to save for and come out ahead when buying a starter home compared to renting a typical multifamily unit.  However, with the cost of homeownership this high, buyers have signaled they do not want an expensive project. Turnkey homes sell for 2.9% more than expected, according to Zillow research, while remodeled homes sell for 2.2% more than similar homes without renovations noted in the listing description. Meanwhile, fixer-upper homes sell for 14% less. Not all starter homes need renovations, but buyers who go this route should account for the full cost of ownership, including the possibility of repairs.  The housing shortage is what's driving the affordability crisis In July 2019, before the pandemic, the combined timeline was 11 years nationwide, nearly four years shorter than it is today. At the root of the housing affordability crisis is a shortage that stands at 4.7 million homes, according to Zillow's latest estimate. The metros with the largest shortages tend to also have the longest break-even timelines. Los Angeles, for example, has the second-largest deficit at nearly 345,000 homes, and a break-even timeline of nearly 38 years.  Closing a gap this large requires action on multiple fronts. Zillow advocates for measures that make it easier and less expensive to build, including modernizing zoning to allow more density, streamlining permitting, and expanding financing options for manufactured housing.