At the same time, the share of underwater mortgages is well integrated. About 3% of mortgages had loan balances at least 25% above their appraised value – up from 2.8% in the previous quarter.
The ATTOM report said Q4 2025 marked the lowest share of wealth properties since late 2021 while stressing that overall equity levels continue to compare favorably with historical benchmarks.
At the beginning of 2020, only about one-fourth of the mortgages were considered rich.
“After years of rapid gains, home owner equity is reaching a stable level, and that’s not a bad sign for the market,” said Rob Barber, CEO at ATTOM. “Even with the modest decline in equity-rich properties and the slight rise in underwater housing, overall equity levels remain remarkably strong by historical standards.
“As we head into the spring buying season, these numbers suggest a healthy housing market rather than an overheated one, giving homeowners a solid financial footing while allowing for healthy market volatility.”
Long-term data shows that leveraged loans are rising from about 27% in 2019 to about 50% in 2022 as home prices rise across the country.
During that time, underwater home values more than halved before falling near historic lows.
Many states are seeing declines in rich stocks
Between the third and fourth quarters of 2025, the share of wealthy mortgages declined in 42 of 49 states, generally by less than 2 percent. The same number of states recorded each year is decreasing.
The largest year-over-year declines occurred in Florida, Kentucky, South Carolina, New Mexico and Arizona. In contrast, modest gains were spread across the Northeast and Midwest — with increases reported in Alaska, North Dakota, Illinois, South Dakota and New York.
Countries with equally rich proportions continued to converge in the Northeast and West.
Vermont led the nation with 87% of its mortgages considered wealthy, followed by New Hampshire, Rhode Island, Maine and Montana.
More than half of the mortgages were in states like New York, Massachusetts, Hawaii, California and Idaho.
Equity-rich stocks are most common in the Midwest and South. Louisiana ranks last at 20.1% – and Maryland, the District of Columbia, Kentucky and Iowa are also near the bottom.
Underwater mortgages stay close to historical conditions
Underwater levels have changed little nationally, underscoring continued stability.
Improvements were recorded in states such as North Dakota, South Dakota, Wyoming and Idaho, while the largest increases occurred in Mississippi, Kentucky, the District of Columbia, Louisiana and Maryland.
The states with the highest rates of inundation are concentrated in the Midwest and South – led by Louisiana at 10.7%.
The lowest rates were found mostly in the Northeast and West, with Vermont at 0.7% and several other states below 2%.
