Homeowners Still Sitting on Equity, but Some States Are Losing Ground

In Q1 2025, the share of U.S. homes with equity-rich mortgages declined quarter over quarter for the second straight time. But despite the dip, nearly half of all mortgaged properties across the country still have homeowners sitting on serious equity.

According to ATTOM’s recent analysis of its U.S. Home Equity & Underwater Report for Q1, 46.2% of mortgaged residential properties were equity-rich in the first quarter of 2025. That’s down from 47.7% at the end of 2024, but still historically high. 

And while 47 states saw quarterly declines, most still posted year-over-year gains.

Before we dive into the state-level trends, here’s a quick reminder of what “equity-rich” means: A mortgage is considered equity-rich when the loan balance is no more than 50% of the home’s estimated market value. In other words, the homeowner owns at least half the home, outright.

Byron Lazine reviewed the ATTOM report on Tuesday’s Hot Sheet. Read on for a quick overview of where the equity is (and where it’s slipping). 

The 10 Most Equity-Rich States in Q1 2025

These states had the highest percentage of equity-rich mortgages in the country:

1. Vermont: 85.8% of mortgaged properties were equity-rich (up from 82.0% a year ago)
2. New Hampshire: 60.5% (up from 57.0%)
3. Rhode Island: 59.8% (up from 55.0%)
4. Montana: 59.4% (up from 58.7%)
5. Maine: 58.9% (down slightly from 59.2%)
6. Hawaii: 58.4% (up from 56.5%)
7. California: 57.4% (down from 58.6%)
8. Massachusetts: 55.9% (up from 53.3%)
9. Idaho: 55.5% (down from 56.3%)
10. New York: 54.1% (up from 49.1%)

Every state in the top 10 had more than half its mortgaged homes considered equity-rich, including California, Idaho, and New York, which came in just under the 55% mark.

States with the Biggest Equity Gains

Several states saw equity-rich rates rise sharply year over year. 

The top five:

1. Connecticut: Up 5.8 points, from 42.2% to 48.0%
2. New York: Up 5.0 points, from 49.1% to 54.1%
3. New Jersey: Up 5.0 points, from 47.1% to 52.1%
4. Kentucky: Up 4.6 points, from 28.7% to 33.3%
5. Wyoming: Up 4.5 points, from 40.9% to 45.4%

If you’re helping homeowners in any of these markets, this could be a good time to talk about selling, downsizing, or borrowing against equity for improvements or investment.

Where Equity Is Slipping

Florida posted the steepest year-over-year decline, with equity-rich rates dropping more than 5 points. 

Other notable drops include:

1. Florida: Down 5.1 points (from 54.4% to 49.3%)
2. Utah: Down 3.3 points (from 54.0% to 50.7%)
3. Arizona: Down 3.1 points (from 52.9% to 49.8%)
4. Washington: Down 2.9 points (from 54.2% to 51.3%)
5. Colorado: Down 2.6 points (from 48.4% to 45.8%)

These declines don’t suggest a crash, but they do indicate that massive equity gains are no longer guaranteed, and that some markets may be softening faster than others.

Lowest Equity-Rich States in Q1 2025

At the other end of the spectrum, five states had equity-rich rates below 32%:

1. Louisiana: 20.3%
2. Maryland: 31.4%
3. Illinois: 31.5%
4. Alaska: 31.7%
5. North Dakota: 31.9%

In these markets, many homeowners may have little equity to work with. Agents should be mindful of that when discussing pricing, refinancing, or seller expectations.

Key Takeaways for Real Estate Agents

• Nearly half of all mortgaged U.S. homes are equity-rich, despite a modest national decline.
• Vermont remains the leader by far, with nearly 9 in 10 mortgages equity-rich.
• Connecticut, New York, and New Jersey posted some of the biggest gains.
• Florida had the most significant equity drop in Q1 2025.
• Low-equity states could present challenges for sellers and opportunities for investor clients.

Even as equity-rich rates slip in some markets, the overall picture still reflects a strong homeowner equity position across most of the country. 

That’s good news for agents helping clients trade up, cash out, or reposition their assets, especially in states where equity has surged.