While the overall picture improved, regional differences remained stark. New England states dominated the top rankings, with Vermont leading at 84.9% of homes considered equity-rich, followed by New Hampshire and Rhode Island, both at 60.3%.
Louisiana struggled at the bottom, with only 18% of mortgaged homes equity-rich. The state also had the highest rate of seriously underwater properties at 11.9%, where homeowners owed at least 25% more than their home’s value.
Connecticut showed the largest year-over-year improvement, with equity-rich rates climbing from 45.5% to 49.4%. New Jersey followed with an increase from 50% to 53.6%. Florida experienced the steepest decline, dropping from 56% to 48.5%.
The share of seriously underwater homes nationwide held relatively steady at 2.7%, down slightly from 2.8% the previous quarter but still above the 2.4% recorded in the second quarter of 2024.
Among major metropolitan areas, California cities dominated the equity-rich rankings. San Jose led with 68.4% of homes equity-rich, followed by Los Angeles at 63.4% and San Diego at 62.5%. Baton Rouge, Louisiana, ranked lowest at just 16.2%.