Homeowners Have Lost $9,200 in Home Equity—Except in These 14 States

September 16, 2025

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The average homeowner in the U.S. has lost $9,200 in equity in the past year, according to a new Homeowner Equity Report from real estate analytics firm Cotality.

But don’t cry for the average homeowner just yet. Thanks to years of gains, the average owner still has an astonishing $307,000 in accumulated home equity.

The report reveals that for the second quarter, nearly every state lost equity as homeowners stall on their gains. Only 14 states experienced growth.

This is “the third-highest figure in recorded history and an increase of $124,000 compared to the first quarter of 2020 at the start of the [COVID-19] pandemic,” says Selma Hepp, Cotality chief economist.

Even in the markets that saw a plunge in home value—such as Washington, DC, and Florida—the average owner still holds almost $350,000 and $290,000 in equity, respectively.

All but 14 U.S. states saw a loss of equity from last year, according to Cotality. (Cotality)

The amount of equity for each property is determined by comparing the estimated current value of the property against the mortgage debt outstanding, using public records.

The report did not take into consideration homes without mortgages, and Vermont was excluded due to insufficient data.

While the recent declines weren’t enough to seriously affect the gains that homeowners have seen, Hepp says that “homeowners should pay attention to the moderating market, however small the cuts.”

Equity can be accessed through loans such as cash-out refinances and home equity lines of credit in addition to selling, so any equity loss can have a negative impact.

“Equity is important because the more it is built up, the more can be tapped,” she tells Realtor.com®.

“There are clear signals of challenges ahead,” she warns. Home prices this year have experienced the slowest rate of growth since 2008, when prices crashed.

“As appreciation remains modest and even declines in some markets, home equity accumulation is projected to follow suit.”

The top three states with the most loss in equity were the District of Columbia (a loss of $34,400), Florida (a loss of $32,100), and Montana (a loss of $26,900).

“Decreased demand due to federal job losses is likely a large part of it,” Hepp tells Realtor.com of DC’s equity losses.

Previously booming markets that have seen large equity shaves due to major natural disasters include McAllen, TX; Shreveport, LA; Cape Coral, FL; and Ocala, FL, according to the report.

Standout states

However, 14 states—most of them in the Northeast—continue to see their equity climb.

The three states with the largest gains were all in the Northeast: Connecticut ($37,400), New Jersey ($36,200), and Rhode Island ($31,200).

“Most of these states in the Northeast have limited land and entrenched demand (especially New York),” luxury agent Mike Fabbri with The Agency tells Realtor.com.

“Unlike parts of the country that can build quickly, we can’t just add supply. Add in strong job markets, international buyers, and lifestyle factors, and you get upward pressure on prices.”

The Northeast is more insulated from natural disasters than the South or West, so homeowners insurance premiums there haven’t increased as sharply, says Hepp. Plus, the South is seeing a correction from pandemic-era prices.

Despite not being within commuting distance to New York City, Rhode Island makes a splash in the top three.

“There’s so much coastline,” Kate Kirby Greenman of Sotheby’s International Realty says of Rhode Island. “We might be small, but we’re mighty.”

Buyers from across the country—including Florida and California—as well as international investors, are snapping up high-end properties, often for a second or third home.

The stunning cliffs of Newport have always been a magnet for the jet set, and Taylor Swift may have put Watch Hill in Westerly on the map, but Greenman says people who love sailing and cultural events are moving in-state.

She’s also seeing Californians fleeing the high taxes of their state for the Rhode Island coast. And while Rhode Island may offer relative affordability compared to Connecticut, New York, and New Jersey, its smallness means limited inventory, and that pushes prices up.

Four Midwest states also had gains, though more modest: Illinois ($10,000), Wisconsin ($8,000), Michigan ($6,000), and North Dakota ($4,000).

Coldwell Banker agent Cara Ameer agrees that Illinois is hot, noting that her mother, who recently sold her home in Northbrook, a Chicago suburb, had five offers within two days of it hitting the market. Almost all were $50,000 over the asking price.

“All of the buyers interested in her house were rightsizing or downsizing from a property that needed more maintenance and/or relocating to be closer to adult children in the area,” she tells Realtor.com.

“There is not new construction in these areas. Because of this, the demand for existing homes is at a premium.”

As for New York, “people don’t sell unless they have to,” asserts Fabbri. “That creates a squeeze. Lots of qualified buyers chasing very few listings, which pushes prices higher even when the national trend is cooling.

“We can’t sustain this level of demand against limited supply forever, especially with interest rates where they are,” he adds. “But New York historically proves resilient. It corrects less dramatically than other places and recovers faster.”

Ohio ($2,000), Indiana ($1,000), and Pennsylvania ($1,000) held on to their gains, but just barely.

Here are the states with the most equity gains this past year:

1. Connecticut

Gain: $37,000

Median home price: $534,900

This classic 10-bedroom Greenwich, CT, mansion looks like it could star in a Nancy Meyers film. But it could be yours for $34.5 million. (Realtor.com)