Summary
Some U.S. homeowners owe more on their mortgages than their homes are worth, a situation known as being "underwater." A report shows that while the number of such cases is rising slightly, the overall level of negative equity in the housing market is still low by historical standards.
Key Facts
- A home is "seriously underwater" if the mortgage is 25% more than the home's market value.
- 3% of U.S. homes are seriously underwater as of the fourth quarter of 2025.
- Louisiana has the highest rate of underwater properties at 10.7%.
- Other states with high rates include Mississippi and Kentucky.
- Vermont has the lowest rate of underwater properties at 0.7%.
- High equity levels remain strong due to past home price gains and cautious lending.
- The Northeast and West have the highest shares of equity-rich properties.
