How home equity compares in each state
Many American homeowners saw their wealth balloon over the last two years as the U.S. real estate market experienced an unprecedented frenzy.
Homeowners living in less populous western states, in particular, saw their housing values soar as remote work allowed many white-collar workers the flexibility to move further from urban centers and acquire more space at more affordable prices.
In Idaho, for example, home prices rose a whopping 41% between the third quarters of 2020 and 2022, respectively, according to Federal Housing Finance Agency data.
Portland Real Estate examined real estate data platform ATTOM's quarterly home equity report to see which states have the largest share of equity-rich homeowners in the third quarter of 2022. In the case of a tie, the raw number of homeowners was used.
Even as growth in home prices has slowed in the second half of this year, most American homeowners still saw home equity increase. Households are considered equity-rich, or "house-rich," when the property owner's outstanding mortgage balance is half or less than the home's estimated market value. Nationally, about 48.5% of homes with mortgages were considered equity-rich in the third quarter, the 10th straight quarter of gains.
From 2002 to 2022, Americans have seen the portion of their wealth that's tied up in residential real estate collectively grow by $20 trillion—an upward trend line that grew steeper in 2020 and 2021, according to the Federal Reserve.
Many of the most equity-rich homeowners are located on the West Coast, while the Midwest and South have the fewest. In today's high-interest-rate environment, homeowners have limited routes for tapping the equity they've built up in their homes. Home equity lines of credit, or HELOCs, rose in popularity earlier this year but could become less attractive as interest rates climb higher.
