More than 2 million residential properties returned to positive equity in the second quarter, leaving 14.5% of all mortgaged residential properties underwater, according to a leading analytics firm.
According to an analysis released Tuesday by CoreLogic, about 2.5 million residential properties returned to positive equity in Q2, bringing the total number of mortgaged residential properties up to 41.5 million. According to CoreLogic’s report, 7.1 million residential properties remained underwater in Q2 – 14.5% of all mortgaged homes in the country. That’s down from 9.6 million, or 19.7% of all mortgaged homes, in the first quarter.
The aggregate value of negative equity in the U.S. also dropped, from $576bn in Q1 to $428bn in Q2. According to CoreLogic, improving home prices drove the decrease.
“In just the first half of 2013 almost three and a half million homeowners have returned to positive equity, but the pace of improvement will likely slow as price appreciation moderates in the second half,” said Dr. Mark Fleming, CoreLogic’s chief economist.
“Price appreciation obviously had a positive impact on home equity over the first half of 2013, especially the second quarter,” said Anand Nallathambi, president and CEO of CoreLogic. “Despite the substantial decrease in negative equity, there’s more ground left to gain with the 7.1 million U.S. residences that remain underwater.”
Nevada had the highest percentage of mortgaged homes with negative equity at 36.4%, according to CoreLogic. Other states with high amounts of negative equity included Florida (31.5%), Arizona (24.7%), Michigan (22.5%) and Georgia ((20.7%). Out of the 25 largest metropolitan areas, Miami led the pack in negative equity, with 36.5% of its mortgaged homes underwater.