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According to ATTOM Data’s fourth-quarter 2021 U.S. Home Equity & Underwater Report, 41.9 percent of mortgaged residential properties in the United States were considered equity-rich in the fourth quarter, meaning that the combined estimated amount of loan balances secured by those properties was no more than 50 percent of their estimated market values.

The portion of mortgaged homes that were equity-rich in the fourth quarter of 2021 – nearly one of every two – was up from 39.5 percent in the third quarter of 2021 and from 30.2 percent in the fourth quarter of 2020.

The report also shows that just 3.1 percent of mortgaged homes, or one in 32, were considered seriously underwater in the fourth quarter of 2021, with a combined estimated balance of loans secured by the property of at least 25 percent more than the property’s estimated market value. That was down from 3.4 percent of all U.S. homes with a mortgage in the prior quarter and 5.4 percent, or one in 18 properties, a year earlier.

Across the country, 48 states saw equity-rich levels increase from the third quarter to the fourth quarter of 2021, while seriously underwater percentages decreased in 46 states. Year over year, equity-rich levels rose in 49 states, including the District of Columbia, as seriously underwater portions dropped in 48 states, including the District of Columbia.

The latest gains at both ends of the equity scale came as the U.S. housing market concluded one of its best years in the past decade, even as the national economy was only gradually recovering from the worldwide Coronavirus pandemic that hit in 2020. The market surged amid a flood of new home buying spurred heavily by rock-bottom mortgage rates and a desire of many households to trade life in congested virus-prone locales for the wider spaces afforded by a house and yard.