Real Estate·HousingThe average American owner lost $9,200 in equity during the last year.
It’s not a collapse but a ‘long-term market correction’By Sydney LakeBy Sydney LakeAssociate EditorSydney LakeAssociate EditorSydney Lake is an associate editor at Fortune, where she writes and edits news for the publication's global news desk.SEE FULL BIO The average U.S.
owner still has $307,000 in accumulated equity.Getty ImagesOwning a is considered one of the best and most financially savvy a person can make—if you can afford it.
After all, it’s the largest asset class in the largest financial market in the world, and the 30-year mortgage is a unique American invention that (theoretically) invites everyone into the American Dream of ownership.
Buying a house allows people to build equity and wealth over time by making mortgage payments that reduce the loan principal and increase the owner’s stake in the until, ideally, it’s owned outright.
Typically, real estate appreciates, which adds to the owner’s wealth.
In fact, owning a during the past several years has been particularly lucrative as prices spectactularly increased during the pandemic.
But since the Federal Reserve hiked interest rates aggressively in 2023, -price appreciation has been either broadly flat or falling across the U.S., the average American owner lost apximately $9,200 in equity during the past year, according to data from information services company Cotality (formerly CoreLogic).
“ equity growth has shifted from a period of explosive gains in the years surrounding 2022, into a plateau,” Leo Pond, a real-estate advisor with Four Seasons Sotheby’s International Realty, told Fortune.
He explained the transition is driven by a combination of slowing price appreciation, elevated borrowing costs, and supply imbalances.
“This isn’t a collapse, but it is a market digesting several years of unsustainable growth,” he said. “It is a long-term market correction.” Still, the average U.S.
owner still has $307,000 in accumulated equity, according to Cotality. That’s the third-highest figure on record, according to Cotality Chief Economist Selma Hepp.
“Even in where recent price declines have pulled down average equity, such as the District of Columbia and Florida, borrowers on average hold almost $350,000 and $290,000 in equity, respectively,” Selma said in a statement.
prices in Washington, D.C. and Florida dropped the most, down $34,000 and $32,000, respectively.
“Not to sound dismissive of $9,200, money is money [but] when compared to the six-figure equity many owners still hold, $9,200 doesn’t seem as dire,” Jules Garcia, a real-estate agent with Coldwell Banker Warburg, told Fortune.
“It’s definitely more of a concern for owners who bought at market peaks, are experiencing more nounced local market declines, and have higher sale urgency.” ‘Small haircut on top of a very full head of hair’ Zooming out, the total owner equity for borrowers with a mortgage totaled $17.5 trillion in Q2 2025, down 0.8% or $141.5 billion year over year, according to Cotality.
Meanwhile, the number of s with “negative equity,” meaning when a owner owes more on their mortgage than the current market value of their , increased 18% year-over-year to 1.15 million s.
“Despite that being a concerning number, it’s not a panic level just yet,” Garcia said.
“It’s a big warning sign, but there are still many local showing stability.” To put it in perspective, many owners added gobs of money to their equity during the pandemic.
“Many households added far more than during the pandemic, so this adjustment is a moderate correction rather than a crisis,” Pond said.
“For the majority of owners with healthy loan-to-value ratios, this is a small haircut on top of a very full head of hair.” Still, it’s always important to continue to appreciation—especially in the case the owner is looking to sell.
“ prices this year have experienced the slowest rate of growth since the Great Financial Crisis of 2008.
As appreciation remains modest and even declines in some , equity accumulation is jected to suit,” Hepp said.
“With the reduced pace of appreciation, seasonal fluctuations in prices will have a nounced impact on equity changes.” Fortune Global Forum returns Oct. 26–27, 2025 in Riyadh.
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