Zillow recently released their Zillow’s 2016 Q4 Negative Equity Report showing that while there are fewer homeowners underwater on their mortgages, over half of those who are underwater owe at least 20% more than their homes are worth. According to the report, homeowners who owe more than the value of their homes fell to 10.5% at the end of 2016 versus one year earlier when it was 13.1%. Among the nation’s 35 largest metro markets, the highest effective negative equity rates are in Virginia Beach (41.6%), Las Vegas (35.9%) and Indianapolis (33.7%). The lowest rates of effective negative equity among large metros as of the end of 2016 were in San Jose (6.6%), San Francisco (8.6%) and Portland (11.2%).
Key takeaways:
- Nationally, 10.5% of homeowners with a mortgage were underwater at the end of 2016, down from 13.1% of homeowners a year earlier.
- In 2016, 1.2 million homeowners in negative equity were able to resurface, gaining positive value in their homes. Five million homeowners remain underwater.
- More than 55% of homeowners in negative equity are more than 20% underwater.
“Negative equity is one of the most persistent reminders of the long-term losses suffered when the housing market collapsed,” said Zillow Chief Economist Dr. Svenja Gudell. “Accelerating home value appreciation over the past few months was a blessing to owners who have been underwater since the housing bubble burst, but not all underwater owners were able to ride that wave to positive equity.”
Click here to read the full report on Zillow.com.
