A report released this week by Black Knight shows that homeowner equity reached $10.5 trillion in June, the fourth-highest month on record, up from $10.3 trillion in May. (It reached $10.8 trillion at the end of 2022, a bumper year for home prices.)

The Black Knight Home Price Index also hit a record high. The firm's data goes back to 2000.

"Available" equity - the equity available for homeowners to borrow against while maintaining 20% equity - climbed to $10.5 trillion in June, less than $434 billion, or 4%, from the 2022 peak in "available equity."

The average net worth of mortgage holders was $199,000 in June, up from $185,000 in the first quarter of the year, Black Knight said.

About 14 million homeowners refinanced during the pandemic and received ultra-low mortgage rates, the New York Fed said. Cumulatively, homeowners who refinanced over the past three years saved $42 billion, Blacknight added.

On the other hand, only 344,000 homeowners are "underwater," meaning the amount owed on their home exceeds the value of their property. Black Knight added that during the worst of the Great Recession, more than 16 million homeowners were underwater on their mortgages.

Rising house prices are dragging homebuyers down as they find fewer attractive financial options.

In July, it cost homeowners $2,308 to buy an average home worth $443,000, up from $2,292 in June, Black Knight said. That cost includes principal and monthly interest. A family making the median wage must spend 36 percent of its income on a home.

Some of the most unaffordable housing markets include Los Angeles, where the typical household needs to spend 68.9 percent of its income on a mortgage payment, followed by San Diego (60.4 percent) and San Jose (58.4 percent), Black Knight said.

The most affordable markets are in the Midwest. In Cleveland, the typical homebuyer needs to spend only 22.9 per cent of their income on a mortgage payment, in Pittsburgh only 25 per cent of their income, and in Oklahoma City only 25.2 per cent of their income.