Changes in the Value of Household Real Estate

In the first quarter of 2026, the Federal Reserve’s Flow of Funds data revealed that the total value of owner-occupied real estate climbed to a new record high of $48.7 trillion. Mortgage debt also continued its upward trajectory, reaching an all-time high of $13.8 trillion. As a result, home equity rose to $34.9 trillion.

Here’s what we learned

The value of homes rebounded to a record high

In the first quarter of 2026, the total value of owner-occupied real estate, the value of all homes owned by those living in them, hit a new record high, increasing $810 billion from the previous quarter to $48.7 trillion. Meanwhile, homes gained $1.2 trillion in value over the past year. Further, the total value of real estate has more than doubled since mid-2016.

New mortgage debt continued to grow, but at a slower pace

During the first quarter of 2026, mortgage debt reached a new high total of $13.8 trillion, reflecting an increase of $37 billion from the previous quarter and 2.8% from the same period the previous year. The annual growth in mortgage debt was slightly faster than what was typical in 2017–19, despite being less than half of what was typical from mid-2021 to the end of 2022.

Home equity continued to grow

With rising mortgage debt and real estate values, aggregate home equity increased by $772 billion since last quarter and now stands at 71.6%. While equity as a share of total value is lower than its recent peak of 72.3% seen in 2024Q2, it remains greater than at any other time between 1961 and 2023.

It’s worth noting that the trend observed here is for the aggregate or total value of equity versus real estate value. For any individual household, there will be more or less than this amount.

Home equity reshapes today’s housing context

With home values at a record high, today’s elevated home equity provides a significant cushion for both homeowners and the broader economy. Even if homes were to lose 10% of their value overnight, homeowner equity would still be at 68.5%, similar to 2021. Using this framework, a 20% drop in home prices would leave homeowner equity at 64.5% of real estate value, on par with what we saw in late 2019 and early 2020.