The number of homes in negative equity continued to lessen through the end of the third quarter, according to CoreLogic.
Approximately 44.6 million, or 90%, of all mortgaged residential properties had equity, the Irvine, Calif.-based analytic company said. Nearly 273,000 homes nationwide returned to positive equity in the third quarter.
However, nearly 5.1 million residential housing units, or 10.3%, were underwater — where borrowers owe more on their mortgages than their homes are worth — in the third quarter. A year ago, the negative equity share was 13.3%, or 6.5 million homes.
For the homes in negative equity status, the aggregate value totaled $338 billion, which is down 16% year over year.
Nevada had more than one-quarter of residential mortgaged homes in negative equity at the end of the third quarter. Other states that contained a high percentage of underwater properties include Florida, Arizona, Rhode Island and Illinois. These five states accounted for 33.1% of negative equity nationwide.
Conversely, Texas had the most properties in an equity position, at 97.4%, followed by Alaska (97.1%), Montana (97.1%), Hawaii (96.4%) and North Dakota (96.1%).
Sam Khater, deputy chief economist for CoreLogic, said the negative equity rate should be at about 8% in a year due to home prices forecasted to appreciate by 5% during this time period.
