Today, one in four U.S. properties with a mortgage is considered “equity-rich.” Equity-rich is a term used to describe borrowers (homeowners with mortgages) who have a combined loan amount that is 50 percent or less than their home’s estimated market value. One-quarter of all households with a mortgage, totaling more than 14 million homes, own more than they owe, according to Attom Data Solutions. In 2016, just 22.1 percent of homes in the U.S. were equity-rich.

The share of seriously underwater properties in the second quarter of 2017 dropped dramatically year-over-year. Seriously underwater is a term used to describe homes that owe more than they own with a combined loan amount that’s at least 25 percent higher than the home’s estimated market value. Fortunately, this situation only affects 9.5 percent of all properties with a mortgage, a drop from 11.9 percent one year ago.

The Chicago Home Equity Gap

Chicago home equity paints a more dismal picture, in part because home values vary substantially across the city’s many neighborhoods. Just 15 percent of the metro area’s homeowners are equity-rich while a greater 17 percent are seriously underwater. Chicago has the smallest share of equity-rich homes of any big 20 metro area.

Equity problems predominately impact neighborhoods farther from the urban core. Apart from Forest Park, the third least equity-rich city in the nation, the two dozen Chicago ZIP codes with the highest underwater mortgage rates are located on the South Side or in the south suburbs of Chicago.

Meanwhile, homeowners living in a northwest neighborhood who purchased when prices bottomed out just after the recession are the equity-rich in the city and metro area, data shows:

Logan Square

In ZIP 60647, 26.9 percent of homeowners are considered equity-rich in their properties, outpacing the national average. As reported in last month’s market update, Logan Square condos reached a median sales price of $402,500 in June, up from $385,000 in May.

Avondale/North Center

In ZIP 60618, 26.1 percent of homeowners have a loan to value (LTV) ratio at 50 percent or less. Avondale also showed the largest sales price jump in June, reaching $350,000 from $260,950 the month prior. North Center’s median sales price grew from $433,500 to $446,000 in the same period.

Z Chicago’s Mortgage Affordability study found that North Center homeowners spend a healthy share of income (27 percent) on the mid-range monthly mortgage. Spending 30 percent or less of income on housing payments every month is a primary ingredient for healthy personal finances, according to economic experts.

Farther from Downtown

Oak Brook (ZIP 60523), a community 20 miles west of the city, has the highest share of equity-rich residents in the entire Chicago metro at 27.7 percent of all homeowners. Closer to downtown in Old Irving Park (ZIP 60641), 24.2 percent of homeowners own more than they owe. For 60630, the ZIP encompassing North Mayfair and Jefferson Park, 23.9 percent of homeowners have an LTV at 50 percent or lower.

According to Attom’s Senior Vice President Daren Blomquist, the healthiest equity stake generally belongs to homeowners who’ve lived in their residences for more than 15 years. For the most part, homeowners richest in equity purchased before home prices peaked in 2005 and before the recession brought property values to devastating lows. As outlined above, rising home prices also play a crucial role in stronger equity stakes.

Homeowners who bought homes in the mid-2000s before the financial crash are in a radically different position altogether. Between 2006 and 2013, over 9.3 million homeowners across the nation suffered a foreclosure, surrendered to their lender or sold in distress, according to an analysis from the National Association of Realtors (NAR).