Home prices basically stabilized nationwide in the fourth quarter – and as a result, home equity gains dipped sightly.
However, as per ATTOM’s fourth quarter 2024 U.S. Home Equity & Underwater Report, 95% of homeowners continue to have property wealth built-up – and only a small portion of homeowners are seriously underwater on their mortgages.
The report shows that 47.7% percent of mortgaged residential properties in the U.S. 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 48.3% in the third quarter and from a recent peak of 49.2% in the prior three-month period.
However, it was still up from 46.1% in the fourth quarter of 2023 and remained at historically high levels that again showed one of the most profound benefits of the nation’s 13-year housing market boom.
Meanwhile, just 2.5% of mortgaged homes fell into that category during the fourth quarter were seriously underwater – where combined estimated balances of loans secured by properties were at least 25% more than those properties’ estimated market values.
That was the same as in the third quarter and almost unchanged from the 2.6% level recorded in late- 2023.
“The last few months of 2024 marked pretty much a holding pattern for the housing market,” says Rob Barber, CEO for ATTOM, in the report. “That’s typical for the slower Fall home buying season. But it certainly wasn’t a downer for homeowners across the country who are sitting on historically high levels of property equity thanks in large part to the endless increases in home values over more than a decade.”
“Nearly half of all residential mortgage payers in the U.S. have paid off at least half their loans, leaving many with six-figures levels of wealth available to leverage anything from new home purchases to starting new businesses to paying off major expenses,” Barber says.
“We are likely to see more of the same steady pace over the next few months before heading into the Spring buying season, which will say a lot about whether the housing market keeps roaring ahead and boosts home equity even further,” Barber adds.
Photo: Roger Starnes Sr