Press Release
Record home equity builds, yet remains untouched by borrowers
IRVINE, Calif., September 10, 2026 — Borrowers in the U.S. have never been in a stronger financial position. For borrowers with a mortgage, total equity reached $17.9 trillion this quarter, and outstanding mortgage debt currently stands at roughly $14 trillion, according to Cotality’s Homeowner Equity Insights Report. With total homeowner equity at over $34.9 trillion, the average loan-to-value ratio hovers at just 44%. Only 2.1% of mortgages are underwater.
Nationwide, there is now $11.5 trillion in tappable equity. That portions out to an average of $310,000 in housing wealth per homeowner with a mortgage, which is a $6,000 increase from the previous quarter. Yet relatively little of that wealth is being put to work in the broader economy, nor is it equally distributed. Buyers who purchased in 2020 hold roughly $86,000 more equity than buyers who purchased in 2023, and that gap may be permanent, according to a new Cotality analysis.
New closed-end second mortgages and HELOC originations increased 19.8% quarter over quarter in Q2 2026, rising from $78.2 billion to $93.7 billion. Even so, that represented less than 0.1% of the total tappable equity homeowners with a mortgage could have drawn from.
“Homeowners have accumulated enormous amounts of equity, but most of it isn’t doing much,” said Thom Malone, principal economist at Cotality. “The borrowers with the most housing wealth are often the least likely to tap it. They tend to have low mortgage rates, strong cash flow, and little reason to move. That means much of the country’s record home equity remains on the sidelines, while the same homeowners continue to benefit from the lower monthly payments that helped create it in the first place.”
Homeowners can access their accumulated housing wealth through home equity loans and home equity lines of credit (HELOCs) without giving up the low mortgage rates many secured before 2022. However, these borrowers are often the least likely to need additional financing. Lower mortgage payments leave them with stronger monthly cash flow, reducing the need to finance renovations, debt consolidation, or other expenses through home equity products.
Regional housing wealth gap continues to widen
Equity remains heavily concentrated in the West and Northeast. Hawaii ($644,000), California ($623,000), and Massachusetts($486,000) held the highest average homeowner equity levels in Q2 2026. At the other end of the spectrum, Louisiana ($109,000), Oklahoma ($124,000), and Iowa ($125,000) had the lowest equity levels. These regional differences have widened considerably over the course of the decade as home-price appreciation has increasingly benefitted already high-equity markets.
Average equity per borrower by state
Data source: Cotality, 2026
Housing wealth disparities continue to grow
Rising home equity has widened housing wealth disparities across the country. In Q1 2020, the gap between the highest- and lowest-equity states was approximately $395,000. By Q2 2026, that difference had expanded to $534,000.
Even outside of the most extreme comparison, the wealth gap is widening. In New Hampshire which ranks No. 10 in terms of equity reserves, homeowners have an average of $176,000 more in equity than they do in Alabama, which comes in at No. 40. When comparing Idaho and Alaska, which are ranked No. 20 and No. 30 this quarter, respectively, there is a $56,000 in equity reserves — that gap is twice as wide as it was in Q1 2020.
Average equity gain by state, 2020 - 2026
Data source: Cotality, 2026
Leaders remain leaders
Despite the dramatic shifts in housing markets during the 2020s, wealth has remained in generally the same location. Hawaii retains its spot as the state with the highest equity, and Louisiana remained in last place. Six of the 10 highest-ranked states in 2020 remain in the top ten today, while nine of the 10 lowest-ranked states still occupy the bottom 10.
The biggest changes come from the Northeast. Connecticut and New Hampshire each climbed 11 places, reaching eighth and 10th place, respectively. Texas experienced the largest decline, falling from 24th to 35th place.
The difference in equity gains illustrates how much the gap has widened. Connecticut and New Hampshire homeowners gained $239,000 and $207,000 in equity, respectively, while Texas homeowners gained $58,000.
State ranking changes since 2020
Data source: Cotality, 2026
Top and bottom states, change in average equity rank (2020-2026)
Data source: Cotality, 2026
Methodology
The amount of equity for each property is determined bycomparing the estimated current value of the property against the mortgage debtoutstanding (MDO). If the MDO is greater than the estimated value, the propertyis determined to be in a negative-equity position. If the estimated value isgreater than the MDO, the property is determined to be in a positive-equityposition.
The data is first generated at the property level andaggregated to higher levels of geography. Cotality uses public-record data asthe source of the MDO, which includes more than 50 million first- andsecond-mortgage liens and is adjusted for amortization and home equityutilization to capture the true level of MDO for each property.
Only data for mortgaged residential properties that have acurrent estimated value are included. There are several states or jurisdictionswhere public-record, current-value, or mortgage-data coverage is thin and havebeen excluded from the analysis. These instances account for fewer than 5% ofthe total U.S. population.
The percentage of homeowners with a mortgage is from the2019 American Community Survey. Data for the previous quarter was revised.Revisions to public-record data are standard, and Cotality incorporates newlyreleased data to provide updated results.
Source: Cotality
The data provided is for use only by the primary recipientor the primary recipient’s publication or broadcast. This data may not beresold, republished, or licensed to any other source, including publicationsand sources owned by the primary recipient’s parent company, without priorwritten permission from Cotality.
Any Cotality data used for publication or broadcast, inwhole or in part, must be sourced as coming from Cotality, a data and analyticscompany. For use with broadcast or web content, the citation must directlyaccompany the first reference to the data. If the data is illustrated withmaps, charts, graphs, or other visual elements, the Cotality logo must beincluded on screen or on the website.
For questions, analysis, or interpretation of the data,contact newsmedia@cotality.com. Data provided may not be modified without priorwritten permission from Cotality. Do not use the data in any unlawful manner.
About Cotality
Cotality accelerates data, insights, and workflows acrossthe property ecosystem to enable industry professionals to surpass theirambitions and impact society. With billions of data signals across the lifecycle of a property, we unearth hidden risks and transformative opportunitiesfor agents, lenders, carriers, and innovators. Get to know us at cotality.com.
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