That’s how many U.S. homes are worth at least twice as much as the mortgages on them, thanks to rising home prices.
Equity-rich residential properties—homes with mortgage balances amounting to no more than 50% of their estimated market value—are increasingly common, ATTOM Data Solutions said Thursday. In the fourth quarter, they accounted for roughly 30% of the almost 59 million mortgaged homes, the most for any quarter since at least the third quarter of 2019, when ATTOM started collecting data.
One of the silver linings of the pandemic economy has been a booming housing market. Last year the national median home price jumped more than 13%, topping $314,000, as households spending more time at home were lured by record low interest rates, driving up demand faster than supply. For a 30-year fixed mortgage, rates that averaged almost 5% as recently as 2018 are now 2.73%, according to Freddie Mac.
Home prices are rising so much that even if rates stay super low, a typical mortgage payment is likely to go up, according to a report by Zillow, a real estate marketplace. The monthly mortgage payment on a typical U.S. home will rise to $952 a month by the end of the year, up from $862 last December because of the cost of a home.