BREAKING: Negative equity tumbles as housing bounces back

by Kelli Rogers12 Jun 2013

Rising home prices helped 850,000 borrowers regain equity in their homes during the first quarter of 2013, according to the latest report from real estate analytics provider CoreLogic.

According to the report, 9.7 million properties, or 19.8% of all properties with a mortgage, still had negative equity at the end of the first quarter. That is down from 10.5 million, or 21.7% of all residential properties with a mortgage, at the end of the fourth quarter.

“The impressive home price gains of 2012 and the beginning of 2013 have had a big impact on the distribution of residential home equity,” said Dr. Mark Fleming, chief economist for CoreLogic. “During the past year, 1.7 million borrowers have regained positive equity.”

The decline in underwater borrowers might also release pent-up supply and moderate price gains in fast-appreciating markets, according to Fleming. This is of course good news for homebuyers who have been struggling to find homes amid unusually tight supply conditions.

According to the report, Nevada had the highest percentage of mortgaged properties in negative equity at 45%, followed by Florida at 38.1%, Michigan at 32%, Arizona at 31.3% and Georgia  at 30.5%. These top five states combined account for 32.8% percent of negative equity in the U.S.

The national aggregate value of negative equity decreased more than $50 billion to $580 billion at the end of the first quarter from $631 billion at the end of the fourth quarter of 2012. This decrease was driven in large part by an improvement in home prices.

COMMENTS

  • by TonyS | 6/14/2013 5:52:04 AM

    Can you produce ONE HOME that SOLD this
    year for MORE then it was purchased for in 2005. Home prices dropped by more than 40% for 2008-2009. You're saying that home prices have not only reached 2005 levels but are 7 to 10% higher. Prove it publish one home sale price from public records anywhere in the country that more then 2005 price in true full article not a deceiving one for head lines.

  • by Ron | 6/14/2013 11:27:06 AM

    Can you point out in the article where is states anything about home prices being higher than they were in 2005. I keep re-reading it and just don't see it. What it does state is that based on current values, 1.7 million borrowers have regained positive equity During the past year; not euity equal to or greater than they had in 2005, just equity vs. being upside down. I happen to be one of those that regained equity recently. If values are sustainable its good news.

  • by Marvin Von Renchler | 6/19/2013 12:49:16 PM

    Come on. Grandstand headlining. Thats a drop in the bucket compared to all those who have not (And maybe never will)

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