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Number of underwater homes continues to decline

underwater-houseThe Charlotte-Concord-Gastonia area fares better than the national average when looking at underwater residences, according to a RealtyTrac analysis.

Eight percent of homes in the area with a mortgage had a loan-to-value ratio of 125 percent or more in the fourth quarter, meaning the loan amount was at least 25 percent higher than the market value of the property. In the third quarter, 10 percent of area homes with a mortgage were seriously underwater.

Across the United States, 13 percent of homes with a mortgage were seriously underwater this past quarter, down from 19 percent a year ago and 15 percent in the third quarter of 2014. Some 7.05 million homes throughout the nation were underwater, according to RealtyTrac.

Fifteen percent of properties with a mortgage in the Charlotte metro area are equity-rich, having at least 50 percent equity in their homes. That’s the same as in the third quarter.

During the fourth quarter, the report said, 85,374 homes in the Charlotte-Gastonia-Concord metropolitan statistical area were “resurfacing,” meaning that these homes are either underwater by up to 10 percent or have equity of up to 10 percent. These properties account for 20 percent of all area homes with a mortgage. In the third quarter, nearly 92,000 homes were resurfacing, accounting for 20 percent of area homes.

Some 16 percent of mortgaged homes nationwide, or 8.7 million, were on the verge of resurfacing last quarter. That’s roughly the same as in the third quarter of 2014.

The national fourth-quarter figure of 13 percent is the lowest level since RealtyTrac began reporting negative equity in the first quarter of 2012. The peak occurred in the second quarter of 2012, when 12.8 million homeowners, or 29 percent of all those with a mortgage, were seriously underwater.

Meanwhile, the number of U.S. mortgaged residences with at least 50 percent equity in the fourth quarter was 20 percent of all homes with a mortgage, the same as in the third quarter, and up from 18 percent in the fourth quarter of 2013.

The Charlotte-Concord-Gastonia region continues to fare better when its statistics are compared with national figures.

In the Charlotte metro area in the fourth quarter, 17 percent of properties facing foreclosure were seriously underwater, while 54 percent of distressed homes had equity. In the third quarter, 20 percent of distressed properties were seriously underwater, while 46 percent had equity.

Across the United States, 35 percent of homes in the foreclosure process were seriously underwater in the fourth quarter. In the third quarter, that number was 39 percent.

Conversely, the portion of foreclosures with some equity rose to 42 percent in the fourth quarter, up from 38 percent in the third quarter.

Other highlights from the report:

*States with the largest share of mortgages that were seriously underwater in the fourth quarter were Nevada, at 27 percent; Florida, at 25 percent; Illinois at 21 percent; Michigan at 20 percent; and Kansas and Georgia, each at 19 percent.

*Markets where the share of distressed properties having positive equity exceeded 60 percent included Denver and Pittsburgh, each at 81 percent; Oklahoma City at 76 percent; Austin, Texas, at 73 percent; and Nashville, Tenn., at 70 percent.

*Markets with the largest percentage of equity-rich homeowners – those with at least 50 percent equity or more – included San Jose, Calif., at 43 percent; San Francisco at 39 percent; Honolulu at 36 percent; and Pittsburgh, New York and Los Angeles, each at 32 percent.

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