One in 10 Mortgaged Properties Are Seriously Underwater

August 9, 2018
underwater house
More than 5.5 million residential properties with a mortgage, or 10.1 percent of this housing sector, were seriously underwater during the second quarter of this year, according to new statistics from ATTOM Data Solutions.
The states with the highest share of seriously underwater properties were Louisiana (21.7 percent), Illinois (18.5 percent), Missouri (17.8 percent), Mississippi (16.8 percent) and Ohio (16.2 percent). Among 97 metropolitan statistical areas analyzed in the report, the highest shares of seriously underwater properties occurred in Baton Rouge, La. (21 percent), Toledo, Ohio (20 percent), Scranton, Pa. (19.6 percent) Youngstown, Ohio (19.3 percent) and New Orleans (18.9 percent).
On the flip side, more than 13.6 million properties in the second quarter were equity rich, representing 24.5 percent of all U.S. properties with a mortgage. The states with the highest share of equity rich properties were California (43.5 percent), Hawaii (38.3 percent), Washington (34.5 percent), New York (33.2 percent) and Oregon (32.8 percent). The metro areas with the highest share of equity rich properties were San Jose (71.9 percent), San Francisco (60.8 percent), Los Angeles (47.9 percent), Seattle (41.1 percent) and San Diego (40 percent).
“The share of seriously underwater properties has dropped well below 10 percent in bellwether housing markets such as California, Washington, Texas, Colorado and New York, but the underwater rate remains stubbornly high in markets where price appreciation has not been as strong during the housing recovery of the last six years,” said Daren Blomquist, senior vice president with ATTOM Data Solutions. “Nationwide the number of equity rich homeowners is more than twice the number of seriously underwater homeowners, but the gap between home equity haves and have-nots persists because home price appreciation is certainly not uniform across local markets or even within local markets.”