Home Equity Is Splitting the US Housing Market Between Owners and Newcomers
Home equity, what a home is worth minus what is owed on it, is splitting the US housing market between owners and newcomers. ICE said Monday 2.4 million mortgage holders have $1 million or more, 1.1 million owe more than their home is worth, and Redfin counts the fewest condo buyers on record.
The short answer. Three housing reports out on November 9, 2026 show people who already own building wealth while people trying to get in struggle. People with a mortgage held $17.5 trillion in equity, the part of their homes' value they own outright, a record for a third quarter. Nearly nine in ten underwater loans, those owing more than the home is worth, were made since 2022. That matters to renters and buyers because, Redfin says, owners with equity can wait instead of cutting prices. Every big Florida and Texas metro now has more than two condo sellers for each buyer, a pattern none of the three reports states on its own.
The housing split in three numbers
Show the data
| Item | September 2021 | September 2026 | Change |
|---|---|---|---|
| Condo buyers | 192,000 | 88,460 | -103,540 |
| Condo sellers | 145,000 | 197,248 | +52,248 |
On this page
- How many homeowners have $1 million in home equity?
- Underwater mortgages are rising on loans made since 2022
- Why refinance at 7% to take cash out?
- Why are more buyers choosing adjustable rate mortgages?
- Why the housing market is slow but prices barely fall
- Is the condo market crashing?
- What does a condo cost besides the mortgage?
- Condo market in Florida and Texas
- Why luxury asking prices rise in five Florida markets
- Frequently asked questions
How many homeowners have $1 million in home equity?
Home equity is the part of a home you own outright, its value minus what you still owe. Nearly 2.4 million people with a mortgage now hold at least $1 million of it, the most ICE has counted for a third quarter.
The figures come from the November Mortgage Monitor of Intercontinental Exchange (ICE), which tracks most US mortgages loan by loan. Mortgage holders held $17.5 trillion of equity at the end of September, up 1.4% in a year. That is a record for that quarter of the year, though not the highest ever.
ICE also counts what it calls tappable equity, the part above a cushion of 20% of the home's value. The average borrower has about $204,000 of it, up $16,600 from a year ago.
The equity millionaires are a small group, and they are clustered. California holds about half of them, 1.16 million people. New York, New Jersey and Florida follow far behind. About two in three equity millionaires live in those four states.
Some places stand out. In San Jose, 37% of mortgage holders have crossed the $1 million line, according to ICE's full report. Across California, the share is 16%.
Show the data
| Part | Value | Share |
|---|---|---|
| California | 49.0% | 49.0% |
| New York | 8.0% | 8.0% |
| New Jersey | 6.0% | 6.0% |
| Florida | 4.3% | 4.3% |
| Rest of the US | 32.7% | 32.7% |
Underwater mortgages are rising on loans made since 2022
A home is underwater when the owner owes more on the mortgage than the home would sell for. About 1.1 million borrowers are there now, and nearly nine in ten of their loans were made since 2022.
On page 20 of its full report, ICE counts 2% of borrowers underwater. That is the largest third quarter share in ICE's data going back to 2018. Another 3.5 million have less than 10% equity.
Most underwater loans are recent and needed little money down. Three in four are FHA or VA loans, mortgages backed by the government that let buyers put down very little. Among VA loans made since 2022, 19% are underwater.
For conventional loans of the same years, the usual kind with no government backing, the share is just 1.2%. A small down payment leaves little room when prices dip.
Where prices fell, the shares climb. ICE's highest underwater shares are in Cape Coral, Florida, at 11.2%, then Lakeland, Austin, San Antonio and Tampa. Prices in all five sit below their recent peaks, in Austin by almost a quarter.
A smaller group is in real trouble. 362,000 borrowers are both underwater and at least three payments behind, up from 208,000 a year ago.
Show the data
| Part | Value | Squares |
|---|---|---|
| Made in 2022 or later | 88% | 88 |
| Made before 2022 | 12% | 12 |
Why refinance at 7% to take cash out?
A cash-out refinance swaps a mortgage for a bigger one and hands the owner the difference in cash. It is how owners turn equity into money, even when it means giving up an older, cheaper rate.
When a borrower applies, the lender promises to hold a rate for a while, a step called a rate lock. ICE says 1 in 7 rate locks in recent weeks were cash-outs, while home purchases made up about 80%.
Loans that only aim for a lower rate fell below 5% of locks, likely because about half of active mortgages already carry a rate below 4%.
ICE's Andy Walden said these owners are giving up historically low mortgage rates and taking on higher monthly payments to tap their equity. The new rate applies to the whole loan, the old balance included.
Take an owner who still owes $200,000 at 3% and takes out $100,000 more at 7.18%. The monthly payment rises from about $948 to about $2,032. Of that rise, about $407 is the cost of moving the old balance to today's rate and a fresh 30-year term.
Owners who do it often switch lenders. Cash-outs caused 75% of the loans that mortgage servicers, the companies that collect monthly payments, lost to refinancing in the third quarter, ICE says.
Why are more buyers choosing adjustable rate mortgages?
Buyers facing 7% rates are turning to adjustable rate mortgages, or ARMs, which start lower and then follow the market. ARMs passed 10% of rate locks in early October, the highest share since October 2022.
More than 1 in 10 home purchase locks in October was an ARM, ICE says. A similar share of refinancing borrowers chose one.
The pull is a lower starting rate. A 5/1 ARM keeps its rate for five years, then resets once a year. ICE says its discount against a 30-year fixed loan grew to more than 1 percentage point in early October, as fixed rates passed 7%.
On a $300,000 loan over 30 years, a rate 1 point lower cuts the payment by roughly $200 a month at these rates. After five years, the rate follows the market, and the payment rises if rates are higher then.
Why the housing market is slow but prices barely fall
Buyers have pulled back hard, yet prices have barely moved. Many owners hold old loans far cheaper than today's 7.18% average rate, and enough equity to wait for their price.
Freddie Mac, the government-chartered company that buys mortgages from lenders, tracks the average 30-year rate each week. It sat at 7.40% in mid October, near a three-year high. It then eased for three weeks to 7.18% on November 5.
Buyers stepped back. Redfin reported on October 29 that pending home sales, deals signed but not yet closed, hit the lowest level in its weekly records, which start in 2021. The typical buyer's monthly payment was $2,786, up 10.7% in a year.
Prices only just started to give. Redfin's median sale price dipped 0.1% from a year earlier, its second weekly yearly decline in a row after three years of gains.
Redfin explained on October 20 why prices were still rising then. Many homeowners "have built up enough equity" that they would wait for a better offer, it said. Some pull their homes off the market, "which keeps a floor under prices."
Low old rates add to the pull. About 49% of active mortgages carry a rate below 4%, ICE says. More than half of borrowers pay a rate at least 3 points lower than a new loan would cost. Realtor.com's economist Hannah Jones called rates below 3% "an extraordinary exception" in an October 22 report, and said owners still make decisions around them today.
Show the data
| Category | Value |
|---|---|
| October 8 | 7.40% |
| October 15 | 7.40% |
| October 22 | 7.32% |
| October 29 | 7.24% |
| November 5 | 7.18% |
Is the condo market crashing?
Condo prices are slipping, not collapsing. What has collapsed is the number of buyers, 88,460 in September, the fewest in Redfin's records, against more than twice as many sellers.
Redfin's condo report counts 197,248 condo sellers in September. That is about 2.2 sellers for every buyer, the widest gap in records that start in 2013.
A year earlier there were about 2 sellers per buyer. For single-family houses there are about 1.5, a much smaller gap.
Five years ago the condo market ran the other way. In September 2021, during the pandemic buying boom, there were fewer sellers than buyers. Since then, Redfin says, buyers fell 54% and sellers rose 36%. That works out to about 104,000 fewer condo buyers in a month than in September 2021.
Prices have only started to give. The median condo, the one in the middle of all sales by price, sold for about $339,000 in September, Redfin says. That is down 0.8% from a year earlier.
ICE's price index, which tracks the same homes over time, points the same way. In October, condo prices were 1.2% below a year earlier, while single-family prices were 1.3% higher. Houses beat condos in 98 of the 100 largest markets.
Sellers are bending in other ways. Redfin says about 37% of condos that sold in September had a price cut, against 16% five years earlier.
Condos have long been the cheaper first step for renters. First-time buyers "lack equity from a previous home sale," Redfin's report says, so they face today's prices and rates with no cushion.
What does a condo cost besides the mortgage?
A condo comes with costs a house buyer may not face, such as monthly HOA fees, the building's insurance and surprise repair bills called special assessments. Redfin says those costs weigh most in Florida and Texas.
An HOA, or homeowners association, runs the building. Owners pay it a monthly fee for upkeep, shared insurance and savings for big repairs. When those savings fall short, the HOA can bill every owner a one-time special assessment.
Redfin says rising insurance premiums, HOA fees and special assessments are making condos "increasingly expensive to own." It points to Florida and Texas, "where hurricane risks and other natural disasters have contributed to higher insurance costs."
Florida law adds to the bills. Under section 718.112 of the state's statutes, condo buildings of three habitable stories or higher need a structural integrity reserve study at least every 10 years. It is a review of the building's big parts and of the savings, or reserves, needed to replace them.
Engineers, architects or reserve specialists check the roof, structure, fire protection, plumbing, wiring, waterproofing, windows and doors. The study then sets how much the HOA should save each year. Owners pay for those savings through their fees or through special assessments.
That is why a lower price can still mean a higher monthly bill. "San Antonio condos may have an attractive purchase price, but buyers are looking at the total monthly payment," Redfin agent Derrell Skillman said. Many buyers there pick a house when the payments come close, he added.
A buyer of the median $339,000 condo who puts 20% down borrows $271,200. At 7.18% over 30 years, the loan alone costs about $1,837 a month. The HOA fee, property tax and insurance come on top, and so does any special assessment the building bills.
Condo market in Florida and Texas
Every big Florida and Texas metro in Redfin's report has more than twice as many condo sellers as buyers. In the rest of the country, fewer than half of the big metros do.
Redfin lists the 50 most populous metro areas. All 11 in Florida and Texas cross the two-to-one line. Outside the two states, 15 of the other 39 metros do.
San Antonio is the extreme, with 583 condo sellers for 104 buyers, more than five sellers for every buyer. Houston, Miami and Austin follow.
Redfin also points to new construction. The Sun Belt holds nine of the 10 metros where sellers outnumber buyers most, and new buildings add to the supply there.
The exceptions are mostly in the Northeast and the Midwest, plus San Francisco. Nassau County on Long Island was the only seller's market, with more buyers than sellers. Chicago, Milwaukee, Newark, New Brunswick and San Francisco were balanced.
San Francisco's median condo price jumped 20% to nearly $1.2 million. Redfin ties the area's renewed demand to highly paid workers drawn by the AI boom.
Show the data
| Category | Value |
|---|---|
| San Antonio, TX | 5.61 |
| Houston, TX | 4.22 |
| Miami, FL | 3.74 |
| Austin, TX | 3.57 |
| Dallas, TX | 3.23 |
| Orlando, FL | 3.20 |
| Fort Lauderdale, FL | 2.92 |
| Tampa, FL | 2.89 |
| Fort Worth, TX | 2.84 |
| Jacksonville, FL | 2.54 |
| West Palm Beach, FL | 2.09 |
| United States | 2.23 |
Why luxury asking prices rise in five Florida markets
Realtor.com tracks the luxury line, the asking price where a market's top 10% of listings starts. Nationally it has fallen for more than two and a half years. In Naples, Florida, it rose 9.0% in a year.
Realtor.com's October luxury report puts the national line at $1,197,014, down 2.3% from a year earlier. It was the 31st month in a row of yearly declines, and the priciest tiers fell faster.
Among the 10 most expensive luxury metros, nine fell, led by San Jose and the New York area. Florida went the other way. Naples, Sarasota, Cape Coral, Miami and Tampa all gained, five of the 12 metros where luxury prices rose.
Realtor.com economist Anthony Smith pointed to a possible reason. "Million-dollar inventory is shrinking and luxury listings are spending less time on the market in most of them," he said, and that smaller pool "may be helping support prices."
The same state holds both ends of the split. Redfin counts about 3.7 condo sellers for every buyer in Miami in September, while the wider Miami area's luxury line rose 4.1% in October.
Two of Florida's five luxury gainers, Cape Coral and Tampa, are also among the five metros with the highest share of underwater mortgages in ICE's report. Tampa shows both sides in one city. Its luxury line rose 2.1% in the year to October. In September, Redfin counted almost 3 condo sellers for every buyer there, and ICE found 6.1% of its mortgage holders underwater.
Put together, those numbers describe one market moving two ways. Its most expensive listings ask more and sell faster than a year ago, Realtor.com's data show. Meanwhile its condo sellers wait on scarce buyers, and nationally most underwater loans are recent ones.
Show the data
| Category | Change |
|---|---|
| United States | -2.3% |
| Naples, FL | +9.0% |
| Sarasota, FL | +7.7% |
| Cape Coral, FL | +4.1% |
| Miami area, FL | +4.1% |
| Tampa, FL | +2.1% |
| San Jose, CA | -12.1% |
| New York area | -11.3% |
What to watch
- Whether mortgage rates keep easing from 7.18%: Freddie Mac's next weekly rate survey, Thursday, November 12, 2026.
- Whether underwater mortgages and equity millionaires keep growing: ICE's next quarterly equity count in its Mortgage Monitor.
- Whether condo buyers come back: Redfin's next condo report.
Our numbers
These figures are our calculations from the sources linked in this article. Redfin's buyer counts are estimates built from home tours and pending sales, so the September 2021 levels derived from them are rounded.
- 11 of 11 Florida and Texas metros with more than twice as many condo sellers as buyers, against 15 of the other 39: Redfin's September sellers divided by buyers for each of its 50 metros.
- About 192,000 condo buyers and 145,000 sellers in September 2021: Redfin's September 2026 counts taken back through its 54% fall in buyers and 36% rise in sellers.
- About 104,000 fewer condo buyers than in September 2021: Redfin's 88,460 buyers set against that 2021 level.
- About two in three equity millionaires in four states: ICE's shares for California (49%), New York (8%), New Jersey (6%) and Florida (4.3%) added together.
- Cape Coral and Tampa in both lists: Realtor.com's five Florida luxury gainers matched against ICE's five metros with the highest underwater shares.
- About $1,837 a month: a $271,200 loan (the $339,000 median condo less 20%) at 7.18% over 30 years, the loan payment alone before taxes, insurance and HOA fees.
- $407 a month in the cash-out example: $200,000 at 7.18% over 30 years ($1,355) minus $200,000 at 3% with 25 years left ($948).
- Roughly $200 a month for a 1 point lower rate: a $300,000 30-year loan at 6.18% against 7.18%.
Frequently asked questions
Are condo prices falling?
Slightly. Redfin's median condo price was about $339,000 in September, down 0.8% from a year earlier. What fell sharply is demand: condo buyers dropped to about 88,460, the fewest in Redfin's records, which start in 2013, with about 2.2 sellers for every buyer.
Why is the condo market down?
Redfin points to mortgage rates above 7%, high prices and rising ownership costs, chiefly insurance, HOA fees and special assessments, worst in Florida and Texas. First-time buyers, who often start with a condo, also lack equity from a previous home to put down.
Is the housing market a buyers market?
By Redfin's measure, yes. It calls the overall market a record-breaking buyer's market, and condo sellers outnumbered condo buyers more than two to one in September. Only Nassau County, New York, was a seller's market for condos among the 50 metros it tracks.
Who are the equity millionaires?
They are mortgage holders whose home is worth at least $1 million more than they owe. ICE counts nearly 2.4 million at the end of September, up 6% in a year. About half live in California, and New York, New Jersey and Florida follow.
Why would someone do a cash-out refinance at 7%?
To turn home equity into cash. The owner takes a new, larger mortgage at today's rate and keeps the difference. ICE says these borrowers give up low rates and accept higher payments for access to their equity, and cash-outs were about 1 in 7 rate locks in recent weeks.
What costs come with a condo besides the mortgage?
A monthly HOA fee, property tax, insurance and, at times, a special assessment, a one-time bill for repairs the association's savings do not cover. In Florida, condo buildings of three habitable stories or higher must get a reserve study at least every 10 years.
Sources
- ICE Mortgage Monitor, November 2026 (press release, November 9, 2026)
- Redfin: condo sellers outnumber buyers by more than 2 to 1 (November 9, 2026)
- Realtor.com October 2026 Luxury Housing Report (November 9, 2026)
- Freddie Mac mortgage rates, November 5, 2026
- Redfin: home-sale prices fall for the first time in 3 years (October 29, 2026)
- Redfin Home Price Index, September 2026 (October 20, 2026)
- Realtor.com: mortgage rate lock-in still dominates (October 22, 2026)
- ICE Mortgage Monitor, November 2026, full report
- Redfin condo report with metro data, November 9, 2026
- Freddie Mac Primary Mortgage Market Survey
- Florida Statutes, section 718.112
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