Fresno's underwater mortgages down slightly
- Published on 11/29/2011 - 9:02 am
- Written by Business Journal staff
Negative equity, the condition in which borrowers owe more on their mortgages than their homes are worth, remains a problem in Fresno where the third quarter negative equity rate stood at 45.2 percent, or 68,815 homes.
That’s down only slightly from 45.5 percent negative equity recorded in the second quarter.
The information is from CoreLogic a provider of consumer, financial and property information.
In addition, 5.9 percent or 8,199 residential properties in Fresno were in equity of less than 5 percent, also referred to as near-negative equity, for the third quarter, compared to 5.4 percent in the second quarter.
Among states, Nevada had the highest negative equity percentage with 58 percent of its mortgaged properties underwater, followed by Arizona, 47 percent; Florida, 44 percent; Michigan, 35 percent; and Georgia, 30 percent.
It was the first quarter that Georgia entered the top five, surpassing California, which had been in the top five since tracking began in 2009. The top five states combined have an average negative equity ration of 41.4 percent.
In the third quarter, California had a negative equity rate of 29.7 percent.
Nationally, 22.1 percent or 10.7 million homes were in negative equity at the end of the third quarter, 2011. That’s down slightly from 10.9 million properties or 22.5 percent in the second quarter.
An additional 2.4 million borrowers nationwide had near negative equity in the third quarter.
“The nearly $700 billion mortgage debt overhang has touched many corners of the market and this overhang is holding back the recovery of the housing market and broader economy,” said Mark Fleming, chief economist with CoreLogic.
Of the 10.7 million borrowers in negative equity, 6.3 million have first liens attached and an average mortgage balance of $222,000. They are underwater by an average of $52,000.
There are 8.6 million conventional loans in a negative equity position that have an average mortgage balance of $272,000 and are underwater by an average of $70,000. Homeowners with FHA loans in negative equity total 1.6 million and have an average balance of $170,000 and are underwater by an average of $26,000.