Thursday, June 08, 2017

CoreLogic: "3.1 million Homes were still in negative equity" at end of Q1 2017

by Bill McBride on 6/08/2017 09:45:00 AM

From CoreLogic: CoreLogic® Reports Nearly 9 Million Borrowers Have Regained Equity Since the Height of the Crisis in 2011

Rising home prices led to improvements in home equity, with 91 thousand residential properties regaining equity in Q1 2017. The number of mortgaged residential properties with equity is now at 48.2 million.

An additional 0.6 million properties would regain equity if home prices rose another 5 percent.
...
CoreLogic® analysis indicates that approximately 3.1 million homes, or 6.1 percent of all residential properties with a mortgage, were still in negative equity at the end of the first quarter of 2017. Negative equity means that a borrower owes more on a home than it is worth. These properties may be referred to as underwater or upside down.
emphasis added
On states:
"Nevada [12.4%, down from 17.5% in Q1 2016], Florida [11.1%, down from 15.0%], Illinois [10.5%], New Jersey [10.2%], and Connecticut [9.9%] account for 32.6 percent of negative equity in the United States."
Note: The share of negative equity is still high in Nevada and Florida, but down from a year ago.

CoreLogic, LTVClick on graph for larger image.

This graph shows the distribution of home equity in Q1 2017 compared to Q4 2016.

In Q1 2017, 2.4% of properties had 25% or more negative equity.  In Q1 2016, 3.0% had 25% or more negative equity.   For reference, about five years ago, in Q3 2012, almost 10% of residential properties had 25% or more negative equity.

A year ago, in Q1 2016, there were 4.1 million properties with negative equity - now there are 3.1 million.  A significant change.