According to CoreLogic's most recent release, the nation's total number of underwater mortgages declined slightly during the second quarter. However, the volume is still high by historic standards.
Overall, 10.9 million Americans had underwater mortgages at the end of June, representing 22.5 percent of the nation's borrowers. This figure is down slightly from 22.7 percent in the first quarter. However, the total is still high and, in addition, another 2.4 million borrowers had less than 5 percent equity on their home, known as near-negative equity. In total, 27.5 percent of the country's mortgage owners had either near-negative or negative equity during the second quarter.
By state, Nevada had the highest percentage of underwater mortgages with 60 percent, followed by Arizona at 49 percent, Florida at 45 percent Michigan at 36 percent and California at 30 percent.
"High negative equity is holding back refinancing and sales activity and is a major impediment to the housing market recovery," said Mark Fleming, chief economist with CoreLogic. "The hardest hit markets have improved over the last year, primarily as a result of foreclosures. But nationally, the level of mortgage debt remains high relative to home prices."
Underwater mortgage concentrations appear to be the highest in regions with many foreclosures. In the Houston real estate market, foreclosures represented 19.6 percent of all property sales in July, which is slightly up from June, the Houston Association of Realtors reported.
Courtesy of 2M Realty News