Earlier this week, CoreLogic released the results of its newest quarterly Homeowner Equity Report, indicating a large reduction in the number of homeowners with negative equity. The results of the report are highlighted in this article from Brian Honea, writing for DS News.
Approximately three-quarters of a million single-family residential homes regained equity in the second quarter of 2015, bringing the nationwide total of mortgaged residential properties with equity up to 45.9 million (91%), according to data released by CoreLogic on Tuesday.
The number of homes regaining equity totaled about 759,000 for Q2, which translated to a year-over-year increase in borrower equity of about $691 million for the quarter. About 8.7% of all residential homes with a mortgage, or about 4.4 million properties, were in negative equity in Q2 2015 – both declines from 10.9% and 5.4 million from the same quarter a year earlier.
“For much of the country, the negative equity epidemic is lifting. The biggest reason for this improvement has been the relentless rise in home prices over the past three years which reflects increasing money flows into housing and a lack of housing stock in many markets,” said Anand Nallathambi, president and CEO of CoreLogic. “CoreLogic predicts home prices to rise an additional 4.7% over the next year, and if this happens, 800,000 homeowners could regain positive equity by July 2016.”
Homeowners with negative equity owe more on their mortgages than their homes are worth and are often referred to as “upside down” or “underwater” homeowners. Declines in home values or increases in mortgage debts, or a combination of both, can cause a negative equity situation in a home.
