23 Percent of Mortgages Are Underwater
Nearly one-quarter of all U.S. residential properties with a mortgage were in negative equity at the end of the fourth quarter of 2010, according to a new report from CoreLogic. The study finds that 11.1 million, or 23.1 percent, of all mortgages were underwater at the end of the fourth quarter, up from 10.8 million, or 22.5 percent, in the third quarter. Additionally, 2.4 million mortgage holders held less than five percent equity in their homes, known as “near-negative equity,” in the fourth quarter.
Nevada led the nation with the highest percentage of underwater mortgages at 65 percent, followed by Arizona (51 percent), Florida (47 percent), Michigan (36 percent) and California (32 percent).
“Negative equity holds millions of borrowers captive in their homes, unable to move or sell their properties,” says Mark Fleming, chief economist at CoreLogic. “Until the high level of negative equity begins to recede, the housing and mortgage finance markets will remain very sluggish.”