House prices have been climbing higher for more than two years without pause. Record low interest rates and constrained inventory levels provided a lift to the housing market that continues to free thousands of homeowners from negative equity each month. Nonetheless, the recovery is uneven across the nation.
During the second quarter, 946,000 residential properties regained positive equity, according to the latest reading from CoreLogic. However, 5.3 million mortgaged homes in the United States still suffer from negative equity, and 9.4 million borrowers technically have equity but are considered “under-equitied” due to selling and moving costs. The national aggregate value of negative equity homes totaled $345.1 billion at the end of June, an improvement from $383.2 billion in the prior quarter.
“Many homeowners across the country are seeing the equity value in their homes grow, which lifts the economy as a whole. With more and more borrowers regaining equity, we expect homeownership to become an increasingly attractive option for many who have remained on the sidelines in the aftermath of the Great Recession,” said Anand Nallathambi, president and CEO of CoreLogic. “This should provide more opportunities for people to sell their homes, purchase a different home or refinance an existing mortgage.”
Overall, 10.7 percent of mortgaged homes have negative equity. Let’s take a look at 10 states with the worst share of underwater homes.
10. New Jersey
Negative equity share: 12.8 percent
Negative equity share: 13.5 percent
Negative equity share: 14 percent
Negative equity share: 14.5 percent
Negative equity share: 14.7 percent
5. Rhode Island
Negative equity share: 14.8 percent
Negative equity share: 15.4 percent
Negative equity share: 19 percent
Negative equity share: 24.3 percent
Negative equity share: 26.3 percent
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