September 2022 Mortgage Monitor

Mortgage Holders Lose $1.3 Trillion in Equity in Q3 as Price Correction Continues; Nationally, Homes Shed 2.6% of Value Over Past Three Months

  • According to the Black Knight Home Price Index, median home prices fell 0.52% in September, continuing a three-month streak of declines – but slowed at half the pace of the prior two months
  • Annualized appreciation slowed to 10.7% – still more than twice long-term norms – and, while indicative of continued correction, the 1.2% decline from August is the smallest seen in four months
  • Despite price corrections, home values in the nation’s 50 largest markets remain elevated by anywhere from 19% to 66% since the start of the pandemic
  • Still, $1.3T (-7.6%) in recently added equity vanished from the market in the third quarter, the largest quarterly dollar decline on record, and the largest on a percentage basis since 2009
  • Equity among mortgaged homes is now nearly $1.5T (-8.4%) off its May 2022 peak, with the equity of the average borrower down $30K from earlier this year
  • While additional declines may be on the horizon, equity positions remain strong; at $5T (46%) above pre-pandemic levels, the average mortgage holder still has more than $92K more equity than before
  • Though the number of underwater homeowners has climbed nearly 275K over the past four months –more than doubling the population – fewer than 500K homes are currently underwater nationwide
  • Nationally, 3.6% of borrowers are either underwater or have less than 10% equity, roughly half the pre-pandemic share; a historically and extremely low share (0.84%) are in negative equity positions

JACKSONVILLE, Fla. – Nov. 7, 2022 – Today, the Data & Analytics division of Black Knight, Inc. (NYSE:BKI) released its latest Mortgage Monitor Report, based upon the company’s industry-leading mortgage, real estate and public records datasets. With home price corrections continuing across much of the country – albeit at a slower pace nationally than seen over the prior two months – the impact on homeowner equity levels is becoming clear. As Black Knight Data & Analytics President Ben Graboske explains, after peaking in Q2 of this year, homeowner equity saw record levels of contraction in Q3 2022.

“In the span of just three months, U.S. mortgage holders saw a total of $1.3T in newly acquired equity evaporate,” said Graboske. “That is – by far – the largest quarterly decline on record by dollar value and the largest since 2009 on a percentage basis. As we reported at the time, while hitting a record high in Q2, total homeowner equity peaked mid-quarter in May and has been pulling back ever since. All in, equity among mortgaged properties is now down nearly $1.5T since that point. From a risk perspective, we’ve already seen the number of underwater borrowers more than double alongside the equity pullback. That said, it’s important to note that – even with 275K falling underwater since May – fewer than half a million homeowners owe more on their homes than their current values. Historically speaking, that is still extremely low.

“Also, as we’ve covered in prior Mortgage Monitors, the vast majority of homes at risk of falling underwater are those that were purchased in 2022 and late 2021, at or near pandemic-era peak prices. While these loans clearly deserve careful, ongoing monitoring, to put that into context, just 3.6% of nearly 53M U.S. mortgage holders are either underwater or have less than 10% equity in their homes – roughly half the share coming into the pandemic. While additional declines may be on the horizon, homeowner positions broadly remain strong. Overall mortgage holder equity is still $5T (+46%) above pre-pandemic levels, for an average gain of more than $92K per borrower during that period. Of course, this – along with rising interest rates – increases the potential for even further headwinds in equity lending as well as heightened default risk.”

This month’s Mortgage Monitor also draws upon Disaster Alerts and McDash Flash daily mortgage performance data from Black Knight to assess the impact from Hurricane Ian in Florida. The 2.5M mortgaged homes in FEMA-declared, county-level disaster areas carry an aggregate unpaid balance of more than $500B and together represent a full 60% of all mortgaged homes in the state. While this can suggest broad, high-level estimates of properties potentially affected by a storm, parcel-level data from Black Knight Disaster Alerts provides far more granular detail. Of those 2.5M total properties, just 355K were directly in the path of the storm and face a higher risk of property damage and mortgage delinquency. Another 100K were in the Disaster Alerts buffer zone, representing moderate risk, while more than 2 million (80% of) properties in FEMA-declared counties were not in the direct path of the storm and are therefore at lower risk of financial loss and mortgage default.

Combining pinpointed impact areas from Disaster Alerts with McDash Flash daily loan-level performance data allows Black Knight to compare payments received in affected areas through Oct. 19 to the share received as of the same point in September. In Florida, counties not declared disaster areas, 93.7% of October payments have been made, only marginally off the 93.9% as of the same day in September. However, for parcels directly in Ian’s path, 3.3% fewer borrowers – with an additional 1.2% fewer borrowers in the buffer zone – have made their October payments. Most notably, in FEMA-declared counties outside of the Disaster Alerts identified in the direct path and buffer zone of the storm, all but 0.5% fewer borrowers had made their mortgage payments, suggesting that those directly in the storm’s path were nearly 7 times more likely to become past due than those in FEMA-declared counties outside of that path. If those deficits should hold true through the end of the month, approximately 20-25K borrowers in Florida can be expected to become delinquent as a result of the storm.

Much more information on these and other topics can be found in this month’s Mortgage Monitor.

About Mortgage Monitor

The Data & Analytics division of Black Knight manages the nation’s leading repository of loan-level residential mortgage data and performance information covering the majority of the overall market, including tens of millions of loans across the spectrum of credit products and more than 160 million historical records. The combined insight of the Black Knight HPI and Collateral Analytics’ home price and real estate data provides one of the most complete, accurate and timely measures of home prices available, covering 95% of U.S. residential properties down to the ZIP-code level. In addition, the company maintains one of the most robust public property records databases available, covering 99.9% of the U.S. population and households from more than 3,100 counties.

Black Knight’s research experts carefully analyze this data to produce a summary supplemented by dozens of charts and graphs that reflect trend and point-in-time observations for the monthly Mortgage Monitor Report. To review the full report, visit:

About Black Knight

Black Knight, Inc. (NYSE:BKI) is an award-winning software, data and analytics company that drives innovation in the mortgage lending and servicing and real estate industries, as well as the capital and secondary markets. Businesses leverage our robust, integrated solutions across the entire homeownership life cycle to help retain existing customers, gain new customers, mitigate risk and operate more effectively.

Our clients rely on our proven, comprehensive, scalable products and our unwavering commitment to delivering superior client support to achieve their strategic goals and better serving their customers. For more information on Black Knight, please visit

September 2022 Report
September 2022 Charts