Map reveals America’s housing danger zones where one in ten homeowners owe more than

America’s housing market is flashing new warning signs – with a growing number of homeowners stuck owing more on their mortgage than their property could sell for. 

New data from ATTOM shows the share of homeowners in that position crept up at the end of 2025, after several years of steady improvement. 

In the final three months of 2025, about 3 percent of homes with a mortgage were what analysts call ‘seriously underwater’ – meaning the owner owed at least 25 percent more than the home was worth. 

That is up from 2.5 percent a year earlier. While still low by historical standards, it marks a clear reversal after years of progress.

In some states, the figure is far higher – reaching nearly one in ten homeowners. See the map below to find out where your state stands. 

Put simply: these homeowners could not sell without needing to bring thousands or tens of thousands of dollars in cash to the closing table. 

‘This is somewhat alarming, but not exactly surprising,’ Joel Berner, a senior economist at Realtor.com, said.  ‘Home values are falling in some areas, and down payments have been relatively low in recent years among new buyers.’

Berner added that many recent homeowners entered the market with limited equity, meaning even small drops in home values can quickly push them into negative territory. 

Revelers fill the French Quarter during 2023’s Magic Carnival of New Orleans in Louisiana, which now has the highest share of homes underwater in the nation.

Separate data from Intercontinental Exchange (ICE) reinforces the trend. By the end of 2025, 1.1 million borrowers – or 2.1 percent – owed more than their homes were worth. 

That marks the largest share since early 2018 and a sharp increase from 696,000 borrowers at the beginning of the year. 

An additional 3.2 million borrowers, representing 7.9 percent of mortgage holders, have less than 10 percent equity in their homes, leaving them particularly vulnerable to modest price declines or job losses.

The pain is not spread evenly across the country, ATTOM analysts found. 

Southern and Midwestern states dominated the rankings, with Louisiana reporting by far the highest share.

Louisiana ranked first nationwide, with 10.7 percent of mortgaged homes seriously underwater, despite a slight quarterly improvement. 

Mississippi followed at 8.3 percent, reflecting sharp increases both quarter over quarter and year over year. 

Louisiana ranked first nationwide, with 10.7 percent of mortgaged homes seriously underwater, despite a slight quarterly improvement

Joel Berner is a senior economist at Realtor.com

In at third place was Kentucky, with 7.9 percent of properties underwater, also posting notable annual growth. Iowa and Arkansas rounded out the top five, each with rates exceeding 5.5 percent. 

Several other central US states – including Oklahoma, Kansas, Illinois, Missouri, and West Virginia – reported rates between 4 and 5.5 percent, well above the national average.

At the local level, counties with the highest concentrations of underwater homes were often rural or located in regions facing economic headwinds, particularly those dependent on energy, manufacturing, or agriculture.

By contrast, much of the Northeast and parts of the West Coast remain relatively insulated. 

Vermont has the lowest share of underwater homes in the nation at just 0.65 percent.  Rhode Island, New Hampshire, Massachusetts, California, and New Jersey all reported rates near or below 1.7 percent.

Large states such as New York, Hawaii, and Nevada also remained under 2 percent, despite gradual year-over-year increases. 

Even in these lower-risk markets, however, the share of seriously underwater homes generally rose compared with 2024, underscoring the broad – though still modest – nature of the shift.

The recent uptick follows several years of declining negative equity, driven by strong home-price appreciation earlier in the decade and tighter mortgage underwriting standards. 

At the other end of the scale, Rhode Island, New Hampshire, Massachusetts, California, and New Jersey all reported negative equity rates near or below 1.7 percent

While the overall increase remains limited, it suggests that slower price growth and localized economic pressures are beginning to affect homeowner equity in certain regions.

Even so, serious negative equity remains far below the levels seen during the housing crisis of the late 2000s, when underwater mortgages were widespread across much of the country. 

Housing analysts emphasize that as long as employment remains stable and lending standards stay conservative, a broad resurgence of negative equity is unlikely.

Still, continued monitoring will be critical – particularly in states and counties already showing elevated risk.