4 million homes get above water in Q4

by MPA10 Mar 2014
A new analysis shows that 4 million homes returned to positive equity in 2013, bringing the total number of above-water mortgaged homes to 42.7 million.

The study, by analytics firm CoreLogic, also indicated that 13.3% of all mortgaged residential properties – almost 6.5 million homes – were still underwater at the end of 2013.

“The plight of the underwater borrower has improved dramatically since negative equity peaked in December 2009 when more than 12 million mortgaged homeowners were underwater,” said Mark Fleming, chief economist for CoreLogic. “Over the past four years, more than 5.5 million homeowners have regained equity, reducing their risk of foreclosure and unlocking pent-up supply in the housing market.”

“Stability and growth in the housing market are essential for a durable recovery of the U.S. economy,” said Anand Nallathambi, president and CEO of CoreLogic. “The rebound in home prices in 2013 helped 4 million property owners regain at least some positive equity in their largest asset—their home. We still have a long way to go to eliminate the negative equity overhang but significant progress is being made every day across most of the country.”

The national aggregate value of negative equity was $398.4 billion in the fourth quarter of 2013, down from $401.3 billion on the third quarter, CoreLogic reported.

But even above-water homeowners can still face difficulties. About 10 million of the 42.7 million above-water residential properties in the country are “under-equitied,” meaning they have less than 20% equity. Under-equitied borrowers can have a more difficult time getting financing for their homes, CoreLogic reported.
 

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