U.S. Homeowner Equity Eases Slightly In Q4 2025 While Seriously Underwater Rates Stay Near Historic Lows     

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ATTOM, has released its fourth quarter 2025 U.S. Home Equity & Underwater Report, which shows that 44.6 percent of mortgaged residential properties in the United States were considered equity-rich in the fourth quarter, meaning that the combined estimated amount of loan balances secured by those properties was no more than half of their estimated market values. 

That level was down slightly from 46.1 percent in the third quarter of 2025 and off from the recent peak of 49.2 percent in the second quarter of 2024. Even so, the fourth quarter of 2025 marked the lowest share of equity rich properties since the fourth quarter of 2021. 

On the other end of the spectrum, there was a modest uptick in seriously underwater properties. In the fourth quarter of 2025, 3.0 percent of mortgaged homes fell into that category, up from 2.8 percent in the third quarter, representing properties where combined estimated loan balances exceeded estimated market values by at least 25 percent. 

“After years of rapid gains, homeowner equity is settling into a more sustainable range, and that’s not a negative sign for the market,” said Rob Barber, CEO at ATTOM. “Even with a modest pullback in equity-rich properties and a slight uptick in seriously underwater homes, overall equity levels remain remarkably strong by historical standards. As we move toward the spring buying season, these numbers suggest a housing market that is stabilizing rather than overheating, giving homeowners a solid financial foundation while allowing for healthier market dynamics.” 

Majority of states see equity-rich portion of home mortgages slip quarterly and annually 

The portion of mortgaged homes that were equity-rich during the fourth quarter of 2025, 44.6 percent, remained far above the 26.5 percent level recorded in early 2020. While the latest figure was down in 42 of the 49 U.S. states from the third quarter to the fourth quarter of 2025, mostly by less than two percentage points, and down annually in 42 states. 

The annual decreases were led by Florida (portion of mortgaged homes considered equity-rich decreased from 50.9 percent in the fourth quarter of 2024 to 43.9 percent in the fourth quarter of 2025), Kentucky (down from 38.5 percent to 32.1 percent), South Carolina (down from 46.7 percent to 40.9 percent), New Mexico (down from 49.6 percent to 44 percent) and Arizona (down from 50.9 percent to 45.4 percent). 

 On the opposite side of the spectrum, equity-rich levels increase slightly across a broad cross section of the U.S., with a concentration in the Northeast and Midwest but coverage across all major regions. The largest year-over-year increases during the fourth quarter of 2025 came in Alaska (up, year over year, from 31.5 percent to 33.5 percent), North Dakota (up from 32.4 percent to 33.7 percent), Illinois (up from 33 percent to 33.7 percent), South Dakota (up from 52.3 percent to 52.8 percent) and New York (up from 54.9 percent to 55.4 percent).