Number of Americans With Equity-Rich Homes Rises, With San Jose, San Francisco and LA at Top

By Douglas A. McIntyre Updated Jan 12, 9:03AM EST · Published Aug 17, 6:20AM EDT

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Number of Americans With Equity-Rich Homes Rises, With San Jose, San Francisco and LA at Top — © Thinkstock

The value of American homes compared with the mortgage on those homes continues to rise since the real estate collapse during the recession, according to information from property database curator ATTOM Data Solutions. The number of houses considered “equity rich” is most concentrated among California’s big cities: San Jose, San Francisco and Los Angeles. Many of these areas have been booming because of the strength of the tech industry.

At the other end of the equity value curve, the number of homes that are underwater is significant but declining. Cities with “seriously underwater” homes are concentrated in Ohio. Information on home values is based on data published by Irvine, Calif.-based ATTOM Data Solutions U.S. Home Equity & Underwater Report for the second quarter of 2017.

At the end of the second quarter, more than 14 million U.S. properties were equity rich; that is, where the combined loan amount secured by the property was 50% or less of the estimated market value of the property. That was an increase of 1.6 million properties from the same period a year ago. The current figure of equity-rich properties represents 24.6% of all U.S. properties with a mortgage.

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In San Jose, the number of equity-rich homes as a percentage of total homes with mortgages is 52%, the highest among the 91 American cities with populations of more than 500,000. San Francisco follows at 47%, and then Los Angeles at 40%, Honolulu at 40% and Portland at 35%.

The report shows 5.4 million properties were underwater, which is when the combined loan amount secured by the property was at least 25% higher than the property’s estimated market value. The good news is, as mentioned, that this number is declining. At the end of the second quarter, there were 1.2 million fewer properties underwater than the previous year.

According to the data, Cleveland leads the list of cities with seriously underwater homes, with nearly 22% of all such homes. This is followed by Baton Rouge, Louisiana, at 21%, while Akron, Ohio; Las Vegas; and Toledo, Ohio, are all near 20%. The 5.4 million seriously underwater properties represented 9.5% of all properties with a mortgage, down from 11.9% in the second quarter of a year ago.

While the national property equity picture has improved, some areas and groups have been left far behind, particularly compared to some of the largest markets in California.

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About the Author Douglas A. McIntyre →

Douglas A. McIntyre is the co-founder, chief executive officer and editor in chief of 24/7 Wall St. and 24/7 Tempo. He has held these jobs since 2006.

McIntyre has written thousands of articles for 24/7 Wall St. He is an expert on corporate finance, the automotive industry, media companies and international finance. He has edited articles on national demographics, sports, personal income and travel.

His work has been quoted or mentioned in The New York Times, The Wall Street Journal, Los Angeles Times, The Washington Post, NBC News, Time, The New Yorker, HuffPost USA Today, Business Insider, Yahoo, AOL, MarketWatch, The Atlantic, Bloomberg, New York Post, Chicago Tribune, Forbes, The Guardian and many other major publications. McIntyre has been a guest on CNBC, the BBC and television and radio stations across the country.

A magna cum laude graduate of Harvard College, McIntyre also was president of The Harvard Advocate. Founded in 1866, the Advocate is the oldest college publication in the United States.

TheStreet.com, Comps.com and Edgar Online are some of the public companies for which McIntyre served on the board of directors. He was a Vicinity Corporation board member when the company was sold to Microsoft in 2002. He served on the audit committees of some of these companies.

McIntyre has been the CEO of FutureSource, a provider of trading terminals and news to commodities and futures traders. He was president of Switchboard, the online phone directory company. He served as chairman and CEO of On2 Technologies, the video compression company that provided video compression software for Adobe’s Flash. Google bought On2 in 2009.