IRVINE, Calif.—The U.S. Home Equity & Underwater Report from RealtyTrac for December 2013 shows a decrease in the number of U.S. residential properties that were underwater and an increase in the number of equity-rich properties. The deeply underwater properties decreased to 9.3 million, representing 19 percent of all properties with a mortgage. The December report showed 9.1 million equity-rich properties, representing 18 percent of all residential properties with a mortgage.
“During the housing downturn we saw a downward spiral of falling home prices resulting in rising negative equity, which in turn put millions of homeowners at higher risk for foreclosure when they encountered a trigger event such as job loss,” says Daren Blomquist, vice president at RealtyTrac. “Now we are seeing the reverse trend: rising home prices resulting in falling negative equity, which in turn is giving millions of homeowners a lifeline to avoid foreclosure when they encounter a trigger event. On the other end of the spectrum, the percentage of equity-rich homeowners is nearing a tipping point that should result in a larger inventory of homes listed for sale and give the overall economy a nice shot in the arm in 2014.”
Other highlights from the report include:
- In September, 10.7 million residential properties were listed as deeply underwater, which was down from 10.9 million listed as such in January 2013. The September report also showed 7.4 million residential properties being listed as equity-rich. Improvement can be tracked on both ends throughout 2013.
- Also showing an increase was the number of residential properties in the foreclosure process that have some positive equity; up from 24 percent in September to 31 percent in December.
- States with the highest percentage of residential properties deeply underwater in December were Nevada, Florida, Illinois, Michigan, Missouri and Ohio.
- States with the highest percentage of equity-rich properties were Hawaii, New York, California, Montana and Maine; the District of Columbia also posted a high percentage.
More on the U.S. Home Equity & Underwater Report for December 2013 and RealtyTrac can be found here.