The number of U.S. properties where the combined estimated amount of loans secured by the property was 50 percent or less of the property’s estimated market value reached an all-time high during the fourth quarter, according to a report from ATTOM Data Solutions.
ATTOM’s Year-End 2018 U.S. Home Equity & Underwater Report found more than 14.5 million U.S. properties were equity rich during the fourth quarter, up by more than 834,000 from a year ago to a new high as far back as data is available (2013).
The equity rich properties in the fourth quarter represented 25.6 percent of all properties with a mortgage, down slightly from 25.7 percent in the previous quarter but up from 25.4 percent one year ago.
The report also found more than 5 million U.S. properties were seriously underwater — where the combined estimated balance of loans secured by the property was at least 25 percent higher than the property’s estimated market value, representing 8.8 percent of all U.S. properties with a mortgage.
“With homeowners staying put longer, homeownership equity will most likely continue to strengthen. Those that are seriously underwater may find themselves coming up for air as they continue to pay off excessive legacy mortgages or sell,” ATTOM Chief Product Officer Todd Teta said in a release.
“This report helps to showcase a story of the West Coast markets having the highest share of equity rich homeowners versus the South and Midwest markets, who continue to have stubbornly high rates of seriously underwater homeowners,” Teta said.
According to the report, the states with the highest share of mortgages that were seriously underwater were Louisiana (20.8 percent), Mississippi (16.9 percent), Arkansas (15.9 percent), Illinois (15.6 percent), and Iowa (15.2 percent).
The metropolitan statistical areas with the highest share of mortgages seriously underwater were Baton Rouge, La. (20.7 percent); Youngstown, Ohio (19 percent); New Orleans (19 percent); Toledo, Ohio (18 percent); and Scranton, Pa. (17.7 percent).
ATTOM found 27 ZIP codes where more than half of all properties were seriously underwater. The ZIP codes with the highest share of seriously underwater properties were 08611 in Trenton, N.J. (70.3 percent); 63137 in St. Louis (64.8 percent); 60426 in Harvey, Ill. (62.3 percent); 38106 in Memphis, Tenn. (60.5 percent); and 61104 in Rockford, Ill. (59.6 percent).