Home equity gains continue to be at all-time highs compared to years prior, but they are starting to moderate, a report said.
Equity slightly dipped, with 48.3% of mortgaged residential properties considered equity-rich in the third quarter, slightly down from a peak of 49.2% reported in the quarter prior, according to Attom Data Solutions.
Third quarter results are still significantly higher compared to the 26.5% level recorded in early 2020.
Rob Barber, CEO for Attom, said the findings correlate with a slight
"Homeowner equity typically mirrors home-price trends, and the third quarter of this year followed that pattern," said Rob Barber, CEO for ATTOM, in a press release. "Despite the flat pattern, home equity keeps providing a significant boost to the economy in the form of financial leverage that tens of millions of households can use to finance major purchases or investments."
Barber said he expects to see "small movements up or down over the coming months as the housing market moves into its annual slow season."A similar pattern is emerging with mortgages considered seriously underwater, Attom said. Only 2.5% of mortgaged homes were grouped in this category, a slightly worse outcome than 2.4% recorded
Annual increases in home equity were concentrated in low- and mid-priced markets, particularly in the Midwest and Northeast regions, the data vendor said.
In Vermont, homes experienced the largest value spike, with 86.4% considered equity-rich in the third quarter, up from 79.8% a year earlier. West Virginia, Connecticut, and Rhode Island also reported significant increases in value.
In contrast, western states saw declines in equity.
In Utah, the percentage of equity-rich homes dropped to 52.4%, down from 56.8% the previous year. Arizona properties fell to 50% from 54.3%, and Colorado homes declined from 51.1% to 48%, according to Attom.
Regarding underwater properties, a mere one in 40 houses were in this category nationwide. A measure well below the ratio of one in 15 recorded in 2020 by the data vendor.
The largest increases year-over-year in the percentage of seriously underwater homes were seen in Kansas, Utah, South Dakota, Missouri and Colorado. These spikes were minimal.
Meanwhile, states with the biggest annual improvements were seen in Wyoming, West Virginia, Louisiana and New Jersey.
