U.S. home prices rose 1% over the year through October, while 2% of borrowers had mortgage debt above their homes’ value in the third quarter, Intercontinental Exchange (ICE) data showed.
The October result marked a pullback from 1.4% earlier in 2026. Prices for single-family houses were up 1.3% year over year, but condominium values slipped 1.2%, ICE’s November Mortgage Monitor said. About two-thirds of markets had prices above year-earlier levels. The Northeast and Midwest together accounted for 22 of the 25 markets with the strongest annual gains.
That national reading masks stress for a smaller group of borrowers. In Q3, around 1.1 million people, or 2% of mortgage borrowers, owed more than their properties were worth, the highest third-quarter share since 2018, ICE said. Another 3.5 million had less than 10% equity.
Negative equity was most prevalent in several Florida and Texas cities. Cape Coral, Florida, led at 11.2%, followed by Lakeland at 8.9%, Austin, Texas, at 8.4%, San Antonio, Texas, at 7.4% and Tampa, Florida, at 6.1%. ICE linked the broader concentration in the South and West to prices falling from recent peaks.
Loans originated in 2022 or later accounted for 88% of underwater mortgages, ICE reported. The company counted 362,000 borrowers who were underwater and at least three payments behind in Q3, compared with 208,000 a year earlier. That was the largest such count since 2018.
Overall, mortgage holders had $17.5 trillion in home equity in Q3, 1.4% above the year-earlier level. ICE’s Nov. 9 announcement also counted 2.4 million mortgage holders with at least $1 million in equity, a 6% annual increase. Andy Walden, ICE’s head of mortgage and housing market research, said, “In a higher rate environment, cash-outs are making up a greater share of refinances.”
ICE had previously reported that adjustable-rate mortgages made up more than 11% of rate locks, as detailed in EconoTimes’ coverage of its October Mortgage Monitor.
