SEATTLE, Dec. 15, 2016 /PRNewswire/ -- Even as home
values approach the highest levels reached during the housing
bubble, 11 percent of homeowners with a mortgage are underwater,
according to the third quarter Zillow® Negative Equity
Reporti.
The share of homeowners who owe more on their mortgages than
their homes are worth has dropped by nearly two-thirds since the
housing bubble burst four years ago. Nationally 5.3 million
homeowners were in negative equity in the third quarter, meaning
they owe more than their homes are worth. At the peak in Q1 2012,
15.7 million homeowners were underwater on their mortgages.
The numbers are another sign that the housing market has nearly
regained the value lost during the recession, and is only 2.7
percent below the peak reached at the height of the bubble. Not all
regions have experienced the same recovery, though, and some
markets are still well below those bubble highs.
Underwater homeowners can't refinance to take advantage of
still-low mortgage rates and they can't sell their homes except in
short sales, which keeps these homes off the market, contributing
to low inventory.
Seven of the 10 large metros with the lowest rates of negative
equity are along the West Coast, and also have strong economic
markets. Fewer than five percent of homeowners are underwater in
San Jose, San Francisco, Portland, Ore., Denver, and Dallas. In these metros, home values have also
surpassed the highest point reached during the bubble, and are now
higher than ever.
Chicago and Las Vegas have the highest levels of negative
equity, with 17 percent and 16.8 percent of homeowners underwater
respectively. Home values in these markets remain well below their
peak levels.
"As the housing market recovers and home values rise, the number
of homeowners underwater on their mortgages continues to drop,"
said Zillow Chief Economist Dr. Svenja
Gudell. "In addition to the individual homeowners who are
underwater, negative equity affects the housing market as a whole,
so this is good news not only for these owners, who are now able to
either sell their home or at least regain some financial stability,
but also for buyers who may find more options now. I expect homes
will gain value steadily, for solid economic reasons, and that
negative equity rates will continue to fall."
Homeowners who have less than 20 percent equity in their homes
may find it difficult to cover the associated costs of selling,
such as agent fees, closing costs, and a new down payment if they
are buying a new home. More than a quarter of homeowners with a
mortgage are in this situation, known as effective negative
equity.
Metropolitan
Area
|
Percent of
Underwater
Homeowners
|
Total Amount
of Negative
Equity
|
Number of
Homes in
Negative Equity
|
Effective
Negative
Equity Rate
|
United
States
|
10.9%
|
$479
billion
|
5,269,166
|
26.1%
|
New York/Northern New
Jersey
|
10.0%
|
$40
billion
|
250,842
|
21.5%
|
Los Angeles-Long
Beach-Anaheim, CA
|
5.7%
|
$18.8
billion
|
90,452
|
14.0%
|
Chicago,
IL
|
17.0%
|
$29.8
billion
|
277,867
|
33.5%
|
Dallas-Fort Worth,
TX
|
4.4%
|
$5
billion
|
44,998
|
12.7%
|
Philadelphia,
PA
|
11.8%
|
$10.7
billion
|
124,492
|
29.4%
|
Houston,
TX
|
6.9%
|
$6.1
billion
|
59,000
|
19.4%
|
Washington,
DC
|
12.4%
|
$19.9
billion
|
136,068
|
30.5%
|
Miami-Fort
Lauderdale, FL
|
10.6%
|
$9.8
billion
|
88,840
|
21.1%
|
Atlanta,
GA
|
13.0%
|
$10.8
billion
|
127,592
|
30.3%
|
Boston, MA
|
6.2%
|
$7.9
billion
|
49,005
|
14.3%
|
San Francisco,
CA
|
3.7%
|
$5.9
billion
|
24,224
|
8.9%
|
Detroit,
MI
|
12.2%
|
$5.8
billion
|
93,270
|
24.0%
|
Riverside,
CA
|
10.5%
|
$8.3
billion
|
65,609
|
26.3%
|
Phoenix,
AZ
|
11.2%
|
$9.1
billion
|
79,519
|
29.6%
|
Seattle,
WA
|
6.6%
|
$6.8
billion
|
41,667
|
17.2%
|
Minneapolis-St Paul,
MN
|
7.3%
|
$5
billion
|
48,956
|
22.4%
|
San Diego,
CA
|
6.3%
|
$4.9
billion
|
27,452
|
18.1%
|
St. Louis,
MO
|
12.6%
|
$4.2
billion
|
66,607
|
30.8%
|
Tampa, FL
|
10.5%
|
$3.6
billion
|
48,764
|
24.9%
|
Baltimore,
MD
|
14.4%
|
$7.9
billion
|
73,895
|
34.4%
|
Denver, CO
|
4.4%
|
$3.3
billion
|
22,326
|
11.9%
|
Pittsburgh,
PA
|
8.1%
|
$2.2
billion
|
33,395
|
19.8%
|
Portland,
OR
|
3.8%
|
$2.1
billion
|
15,152
|
11.7%
|
Charlotte,
NC
|
8.1%
|
$3.6
billion
|
34,268
|
24.2%
|
Sacramento,
CA
|
7.6%
|
$3.6
billion
|
27,123
|
20.9%
|
San Antonio,
TX
|
10.2%
|
$2.9
billion
|
30,933
|
28.3%
|
Orlando,
FL
|
11.4%
|
$3.3
billion
|
39,743
|
27.0%
|
Cincinnati,
OH
|
10.8%
|
$3.1
billion
|
43,385
|
29.6%
|
Cleveland,
OH
|
14.6%
|
$3.3
billion
|
55,547
|
31.1%
|
Kansas City,
MO
|
12.4%
|
$3
billion
|
44,646
|
33.1%
|
Las Vegas,
NV
|
16.8%
|
$5
billion
|
49,809
|
36.8%
|
Columbus,
OH
|
9.0%
|
$2.7
billion
|
31,314
|
24.1%
|
Indianapolis,
IN
|
12.8%
|
$3
billion
|
46,772
|
33.9%
|
San Jose,
CA
|
2.6%
|
$1.9
billion
|
6,905
|
6.4%
|
Austin, TX
|
6.6%
|
$2.2
billion
|
18,383
|
18.6%
|
Zillow
Zillow® is the leading real estate and rental marketplace
dedicated to empowering consumers with data, inspiration and
knowledge around the place they call home, and connecting them with
the best local professionals who can help. In addition, Zillow
operates an industry-leading economics and analytics bureau led by
Zillow's Chief Economist Dr. Svenja
Gudell. Dr. Gudell and her team of economists and data
analysts produce extensive housing data and research covering more
than 450 markets at Zillow Real Estate Research. Zillow also
sponsors the quarterly Zillow Home Price Expectations Survey, which
asks more than 100 leading economists, real estate experts and
investment and market strategists to predict the path of the Zillow
Home Value Index over the next five years. Zillow also sponsors the
bi-annual Zillow Housing Confidence Index (ZHCI) which measures
consumer confidence in local housing markets, both currently and
over time. Launched in 2006, Zillow is owned and operated by Zillow
Group (NASDAQ:Z and ZG), and headquartered in Seattle.
Zillow is a registered trademark of Zillow, Inc.
i The data in the Zillow Negative Equity Report
incorporates mortgage data from TransUnion, a global leader in
credit and information management, to calculate various statistics.
The report includes, but is not limited to, negative equity,
loan-to-value ratios, and delinquency rates. To calculate negative
equity, the estimated value of a home is matched to all outstanding
mortgage debt and lines of credit associated with the home,
including home equity lines of credit and home equity loans. All
personally identifying information ("PII") is removed from the data
by TransUnion before delivery to Zillow. Overall, this report
covers more than 870 metros, 2,400 counties, and 23,000 ZIP codes
across the nation.
To view the original version on PR Newswire,
visit:http://www.prnewswire.com/news-releases/more-than-one-in-10-homeowners-underwater-as-housing-market-nears-full-recovery-300378858.html
SOURCE Zillow