The number of borrowers who owe more on their mortgage than the value of their home continued to improve last year, according to CoreLogic figures.
Nearly 1.2 million borrowers regained equity last year, which brings the total number of mortgaged residential properties with equity at the end of the fourth quarter to approximately 44.5 million, CoreLogic said. This number represents 89% of the 49.9 million mortgaged properties.
The states with the most residential mortgaged properties in an equity position are Texas, Alaska, Montana, Hawaii and North Dakota, the Irvine, Calif.-based analytic provider said.
Furthermore, CoreLogic said borrower equity increased year over year by $656 billion.
However, approximately 172,000 homes fell back into negative equity in the fourth quarter from the previous quarter. Overall, 10.8% of mortgaged properties, or 5.4 million, are considered to be underwater through the end of last year. A year earlier, 6.6 million homes were deemed to be "upside down."
Nevada had the highest percentage of mortgaged properties in negative equity at 24.2%, followed by Florida (23.2%), Arizona (18.7%), Illinois (16.2%) and Rhode Island (15.8%). CoreLogic said these five states account for 31.7% of negative equity nationwide.
For the homes currently in negative equity status, CoreLogic said the national aggregate value was $349 billion in the fourth quarter. First liens without home equity loans accounted for $185 billion of the aggregate amount, while first liens with home equity loans consisted of $164 billion.
"The share of homeowners that had negative equity increased slightly in the fourth quarter of 2014, reflecting the typical weakness in home values during the final quarter of the year," said Frank Nothaft, chief economist for CoreLogic.
CoreLogic is forecasting that home prices will rise 5% this year, which will move about 1 million more homeowners out of negative equity.
