Connect with us

Hi, what are you looking for?

The American Genius Real EstateThe American Genius Real Estate

Real Estate Big Data

Negative equity is falling, but we’re not out of the woods yet

(REAL ESTATE BIG DATA) The number of homeowners who are living “upside down” continues to decline year-over-year and within the last year, most have seen a 5.1% increase in equity

Equity line graph

As real estate goes, 2009 is gone and “fingers crossed” it isn’t ever coming back. As data released Wednesday shows, the number of homeowners who are upside down, in negative equity, continues to decline.

CoreLogic, a provider of consumer, financial and property data, analytics and services to business and government, released the report on Dec. 12.

Being underwater, upside down decreased by 4% to 2 million homes or 3.7% of all mortgaged properties, according to the report, which was shared on the Calculated Risk blog. And, 78,000 properties, that were once negative, left the upside down behind and regained equity in the third quarter of 2019.

According to the report, the 64% of U.S. homeowners with mortgages have seen their equity increase 5.1% year-over-year – a gain of almost $457 billion since the third quarter of 2018.

Advertisement. Scroll to continue reading.

Meanwhile, the number of mortgaged properties in negative equity declined 10% or roughly 220,000 homes in the third quarter of 2019, the report said. In comparison, during the same time period in 2018, 4.1% percent of homes or roughly 2.2 million were upside down.

“Ten years ago, during the depths of the Great Recession, more than 11 million homeowners had negative equity or 25% of mortgaged homes,” said Dr. Frank Nothaft, chief economist for CoreLogic. “After more than eight years of rising home prices and employment growth, underwater owners have been slashed to just 2 million, or less than 4% of mortgaged homes.”

Negative equity can occur for a number of reasons including a decline in the home value or an increase in mortgage debt or both.

CoreLogic began its equity data analysis in the third quarter of 2009. During the fourth quarter of 2009 negative equity peaked at 26% of mortgaged properties.

Even though the numbers of properties in negative equity has declined, there are still nearly 2% of homes with a loan-to-value 125% and higher, according to the report. Yet, year-over-year, the number of homeowners in the negative has declined from 2.2 million to 2 million, according to the report.

Advertisement. Scroll to continue reading.

Mary Ann Lopez earned her MA in print journalism from the University of Colorado and has worked in print and digital media. After taking a break to give back as a Teach for America corps member and teaching science for a few years, she is back with her first love: writing. When she's not writing stories, reading five books at once, or watching The Great British Bakeoff, she is walking her dog Sadie and hanging with her cats, Bella, Bubba, and Kiki. She is one cat short of full cat lady status and plans to keep it that way.

AdBlocker Message

Our website is kept FREE to you by displaying online ads to our visitors. Please consider supporting us by disabling your ad blocker OR subscribing to our email newsletter: https://theamericangenius.com/housing/get-the-newsletter/

The Daily Intel
in your inbox

Subscribe and get news and EXCLUSIVE content to your email inbox.

Advertisement

KEEP READING!

Op/Ed

NAR CEO Bob Goldberg calls the racial homeownership gaps "the most consequential civil rights issue of our day" in this editorial.

Homeownership

(REAL ESTATE) While some folks remain complacent, and others digest the causes, these industry experts are focused on what actions will improve equity in...

Real Estate Big Data

(REAL ESTATE BIG DATA) If you're a millennial, and wondering where you should move that can get you ahead even during this pandemic, here's...

Real Estate Big Data

(REAL ESTATE BIG DATA) COVID-19 has greatly impacted jobs which leads people to not be able to pay rent or mortgage, so how has...

The American Genius' real estate section is honest, up to the minute real estate industry news crafted for industry practitioners - we cut through the pay-to-play news fluff to bring you what's happening behind closed doors, what's meaningful to your practice, and what to expect in the future. We're your competitive advantage. The American Genius, LLC Copyright © 2005-2022