By Ian McKendry
WASHINGTON (MNI) – The number of people who owe more on their home
than the home is worth fell by 600,000 in the second quarter of 2012,
reducing the percentage of people who are “underwater” from 23.7% in the
first quarter to 22.3% in the second, data analytics firm CoreLogic
reported Tuesday.
“The level of negative equity continues to improve with more than
1.3 million housholds regaining a positive equity position since the
beginning of the year,” Mark Fleming, chief economist for CoreLogic said
in a statement.
CoreLogic reported that the dollar value of negative equity fell
from $691 billion at the end of the first quarter to $689 billion at the
end of the second quarter, mostly due to increasing home prices.
“Surging home prices this spring and summer, lower levels of
inventory, and declining REO sale shares are all contributing to the
nascent housing recovery and declining negative equity,” Fleming said.
CoreLogic CEO Anand Nallathambi said in a statement that if home
prices rose just 5% nearly 2 million people would regain equity in their
home.
CoreLogic recently reported that in July, home prices rose 1.27%
from June and were up 3.79% from July of last year.
Nallathambi said that CoreLogic expects prices to continue to rise
in August and that if that trend were to continue, “we could see
significant reductions in the number of borrowers in negative equity by
next year.” CoreLogic said that 2.3 million borrowers have less than 5%
equity in their home.
CoreLogic said “Nevada had the highest percentage of mortgaged
properties in negative equity at 59 percent, followed by Florida (43
percent), Arizona (40 percent), Georgia (36 percent) and Michigan (33
percent). These top five states combined account for 34.1 percent of the
total amount of negative equity in the U.S.”
** MNI Washington Bureau: 202-371-2121 **
[TOPICS: M$$AG$,M$U$$$,MAUDS$]