NINETY PERCENT OF ALL MORTGAGED PROPERTIES NOW HAVE EQUITY

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NINETY PERCENT OF ALL MORTGAGED PROPERTIES NOW HAVE EQUITY
CoreLogic released new analysis showing nearly 273,000 U.S. homes returned to positive equity in Q3 2014, bringing the total number of mortgaged residential properties with equity to approximately 44.6 million, or 90 percent of all mortgaged properties. Nationwide, borrower equity increased year over year by approximately $800 billion in Q3 2014. The CoreLogic analysis indicates that approximately 5.1 million homes, or 10.3 percent of all residential properties with a mortgage, were still in negative equity as of Q3 2014, compared to 5.4 million homes, or 10.9 percent, for Q2 2014. This compares to a negative equity share of 13.3 percent, or 6.5 million homes, in Q3 2013, representing a year-over-year decrease in the number of underwater homes by almost 1.5 million (1,433,296), or 3 percent.

For the homes in negative equity status, the national aggregate value of negative equity was $338 billion at the end of Q3 2014, down $10.2 billion from approximately $348.2 billion in Q2 2014. On a year-over-year basis, the value of negative equity declined from $403.2 billion in Q3 2013, representing a decrease of 16.2 percent in 12 months.

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Of the 44.6 million residential properties with positive equity, approximately 9.4 million, or 19 percent, have less than 20 percent equity (referred to as "under-equitied") and 1.3 million of those have less than 5 percent equity (referred to as near-negative equity). Borrowers who are "under-equitied" may have a more difficult time refinancing their existing homes or obtaining new financing to sell and buy another home due to underwriting constraints. Borrowers with near-negative equity are considered at risk of moving into negative equity if home prices fall. In contrast, if home prices rose by as little as 5 percent, an additional one million homeowners now in negative equity would regain equity.