RealtyTrac, a source for comprehensive housing data, released its Year-End 2015 U.S. Home Equity & Underwater Report, showing that as of the end of 2015 there were 6.4 million U.S. properties seriously underwater — where the combined loan amount secured by the property is at least 25 percent higher than the property’s estimated market value — representing 11.5 percent of all properties with a mortgage.
The report is based on publicly recorded mortgage and deed of trust data collected and licensed by RealtyTrac nationwide along with an industry standard automated valuation model (AVM) updated monthly on RealtyTrac’s entire database of more than 140 million U.S. properties.
The year-end 2015 seriously underwater properties were down 481,292 from 6.9 million, representing 12.7 percent of all properties with a mortgage at the end of the third quarter of 2015, and down 616,189 from 7.1 million, representing 12.7 percent of all properties with a mortgage at the end of 2014. The number of seriously underwater properties at the end of 2015 was half the 12.8 million, representing 28.6 percent of all properties with a mortgage in Q2 2012, the peak for seriously underwater properties.
“Over the past three-and-a-half years, the number of seriously underwater properties has been cut in half, but we continue to deal with a long tail of seriously underwater properties, and it will likely be another five years at least before most of those remaining underwater properties move into positive equity territory,” RealtyTrac Vice President Daren Blomquist said in a news release. “At the other end of the spectrum, the growing number of equity rich properties reflects a moribund move-up market and restrained leveraging of home equity by U.S. homeowners.”
As of the end of 2015 there were 12.6 million U.S. properties that were equity rich (at least 50 percent equity), representing 22.5 percent of all properties with a mortgage. The number of equity rich properties at the end of 2015 was up 2.1 million from the 10.5 million, representing 19.2 percent of all properties with a mortgage at the end of Q3 2015, and up 1.4 million from the 11.2 million, representing 20.3 percent of all properties with a mortgage at the end of 2014.
As of the end of 2015, 49.7 percent of all homes in foreclosure had some equity, the highest percentage since RealtyTrac began tracking in Q3 2013. The share of in-foreclosure properties with equity at the end of 2015 was up from 43.3 percent as of the end of Q3 2015 and up from 34.6 percent as of the end of 2014.
For more information visit www.RealtyTrac.com.