NEW JERSEY — New data from real estate information analyzer ATTOM Data Solutions has revealed that, from the first quarter of 2022 through the second, the percentage of mortgaged residential properties considered “equity-rich” increased in the United States, exception of a State.
According to the ATTOM US Home Equity & Underwater report released on Thursday, the only outlier is New Jersey, which saw its ratio drop from 38.6% to 37.9%.
ATTOM defines “equity-rich” as properties with estimated loan balances no greater than 50% of their market value.
In the United States, on average, the percentage of mortgaged homes deemed “equity-rich” in the second quarter of 2022 fell from 44.9% in the first quarter of 2022 to 34.4% in the second quarter of 2021, ATTOM reported.
“After 124 consecutive months of rising home prices, it’s no surprise that the percentage of equity-rich homes is the highest we’ve ever seen and the percentage of seriously underwater loans is the lowest. “said Rick Sharga, executive vice president of business intelligence at ATTOM. “As home price appreciation appears to be slowing due to rising mortgage interest rates, it seems likely that homeowners will continue to rely on the record amount of equity they have available for the rest of 2022.”
The latest increase affected nearly half of all mortgage payers and marked the ninth straight quarterly increase in homes’ share of the equity-rich designation, the curator added. In fact, the report found that at least half of all mortgage payers in 18 states were considered “stock-rich” in the second quarter of 2022, up from just three states a year earlier.
2.9% of mortgages (1 in 34) were also considered “seriously underwater” in the second quarter of 2022, which represents a combined estimated balance of loans secured by the property of at least 25% more than the estimated market value of the property, by ATTOM. That’s down from 3.2% of all US homes with a mortgage in the previous quarter and 4.1%, or 24 properties, a year ago.
New Jersey, however, was one of three states where the percentage of seriously underwater homes increased from the first quarter to the second quarter of this year, from 2.9 percent to 3 percent. In fact, more than 25% of mortgaged properties in the Philadelphia area have been reported as severely underwater, ATTOM said. The other states listed were Montana (from 3 to 3.9%) and New York (from 2.7 to 2.8%).
In contrast, ATTOM says it is seeing a current wave of migration from high-cost areas of the United States to the South and Southeast as equity-rich mortgages increase in the region. The South and Midwest also saw most of the largest declines in severely underwater properties in states like Mississippi (share of severely underwater mortgaged homes down 17 to 8.1%) and Missouri ( down from 6.6 to 5.2%).
The ATTOM US Home Equity & Underwater report analyzed properties based on several measures of equity – or loan to value (LTV) – at the state, metro, county and zip code level, as well as the percentage of total properties with a mortgage that each equity category represents. To see the full methodology and report, Click here.