Just over 9 million residential properties, or 17 percent of all properties with a mortgage, were seriously underwater in the first quarter of this year, a 26 percent reduction from a year ago. But, according to the latest report from RealtyTrac, a slowdown in home price appreciation is putting a damper on equity recovery.
'Long road back to positive equity'
"U.S. homeowners are continuing to recover equity lost during the Great Recession, but the pace of that recovering equity slowed in the first quarter, corresponding to slowing home price appreciation," Daren Blomquist, vice president at RealtyTrac, said in a news release. "Slower price appreciation means the 9 million homeowners seriously underwater could still have a long road back to positive equity."
The number of properties with at least 50 percent equity also improved during the first quarter, growing to 9.9 million, or 19 percent of all properties with a mortgage. That's up from 18 percent in the fourth quarter last year.
Location, location, location
As with all matters relating to real estate, location makes a difference. Nevada, with 35 percent of all residential properties seriously underwater in the first quarter, topped the list of states with the highest percentage of such properties. It was followed by Florida, with 31 percent, Illinois, with 30 percent, Michigan, with 29 percent and Ohio, with 27 percent.
Metro areas with the highest percentage of properties seriously underwater included Las Vegas; Lakeland and Palm Bay-Melbourne-Titusville, Fla.; Cleveland; Akron, Ohio; and Detroit.
On the flip side, the metro areas with the highest percentage of equity-rich properties were San Jose, Calif.; Honolulu; San Francisco; Poughkeepsie, N.Y.; and Los Angeles.
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