U.S. states where homeowners sit on profits — and where they are most underwater

Some owners owe more than their property is worth. ATTOM tracked equity-rich and underwater rates in 50 states to find which rank at each extreme

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Owning a home is one of the most reliable ways Americans build financial security, but that wealth accumulates at very different rates depending on where the home sits. One owner may have paid off more than half of what their property is worth while a neighbor in another state carries far more debt than the home could fetch if sold today. Those two conditions — equity-rich and seriously underwater — sit at opposite ends of the spectrum that defines what homeownership actually delivers to a family's balance sheet, and the distance between the country's best and worst performers is far wider than most buyers consider before signing a mortgage.

Markets where equity accumulates fastest are not always those with the priciest homes. Long ownership, stable appreciation, and low leverage all play a role, as do markets that attract buyers who stay for decades. Conversely, the states with the worst conditions share structural weaknesses — flood exposure, stagnant home values, industries whose wage growth has failed to keep pace with inflation — that suppress demand, cap price gains, and leave existing owners holding mortgages worth more than the properties securing them. Those vulnerabilities develop over years and rarely resolve quickly, which is why the same states tend to appear at the bottom of these rankings across multiple reporting periods.

ATTOM is a property data and analytics company that analyzed more than 155 million U.S. residential properties for its Q1 2026 Home Equity and Underwater Report. The report calculated loan-to-value ratios across all 50 states to determine the share of mortgaged homes that are equity-rich, meaning the homeowner owes no more than half the property's estimated value, and the share that are seriously underwater, meaning the owner's outstanding debt exceeds the home's market value by at least 25 percent. The six states below represent the three strongest and three weakest performers on those measures.

Strongest: Vermont owners have more equity than anywhere else

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Vermont homeowners have more equity in their properties than those in any other state, with 85.7 percent of mortgaged properties classified as equity-rich in the first quarter of 2026, more than double the national rate of 43.3 percent. No other state comes close. The margin separating Vermont from the second-highest performer is wider than the distance between second place and most of the country, pointing to conditions that set Vermont entirely apart from every other market.

Supply in the state is constrained and demand is consistent. The state's small population, restricted developable land, and stringent environmental regulations have kept inventory tight for decades. Homeowners who buy tend to stay, and long ownership translates directly into paid-down balances. A loan held for 15 or 20 years in a low-turnover market is one where equity accumulates almost by default, particularly when values have moved upward steadily without the sharp reversals that characterize markets defined by overbuilding and speculative demand.

The national backdrop in 2026 reinforces how anomalous Vermont's position is. The equity-rich rate nationwide fell from 44.6 percent in the fourth quarter of 2025 to 43.3 percent — its lowest point since the fourth quarter of 2021 — while the seriously underwater share rose from 3.0 percent to 3.2 percent. Vermont stayed outside that downward current entirely. Its buyer profile favors permanence over mobility, ownership........

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