Seriously Underwater U.S. Properties Down 291,000 From Year Ago, Smallest Annual Decrease Since Tracking Began In Q1 2013
The 13.8 million equity rich properties represented 25.3 percent of all U.S. properties with a mortgage, down from 25.4 percent in the previous quarter but still up from 24.3 percent in Q1 2017.
IRVINE, Calif., May 3, 2018 /PRNewswire/ -- ATTOM Data Solutions, curator of the nation's premier multi-sourced property database, today released its Q1 2018 U.S. Home Equity & Underwater Report, which shows that at the end of the first quarter of 2018, more than 5.2 million (5,206,446) U.S. properties were seriously underwater (where the combined balance of loans secured by the property was at least 25 percent higher than the property's estimated market value), down by more than 291,000 properties from a year ago — the smallest year-over-year drop since ATTOM began tracking in Q1 2013.
The 5.2 million seriously underwater properties at the end of Q1 2018 represented 9.5 percent of all U.S. properties with a mortgage, up from 9.3 percent in the previous quarter but down from 9.7 percent in Q1 2017.
"We've reached a tipping point in this housing boom where enough homeowners have regained both sufficient equity and sufficient confidence to tap into their home equity — resulting in a noticeably slower decline in seriously underwater properties and slower growth in equity rich properties," said Daren Blomquist, senior vice president at ATTOM Data Solutions. "This tapping of equity could take the form of a cash-out refinance, home equity loan or simply a home sale. We saw the biggest quarterly drop in average homeownership tenure for homeowners who sold in the first quarter since Q4 2008, evidence that more homeowners are reaching that equity-tapping tipping point more quickly and deciding to sell."
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Historical U.S. Underwater & Equity Rich Trends |
||||
|
Qtr-Yr |
U.S. Properties |
% |
U.S. |
% |
|
Q1 2012 |
12,533,155 |
27.8% |
||
|
Q2 2012 |
12,824,279 |
28.6% |
||
|
Q3 2012 |
12,472,262 |
27.6% |
||
|
Q1 2013 |
10,894,743 |
25.8% |
||
|
Q2 2013 |
11,336,033 |
25.7% |
||
|
Q3 2013 |
10,714,924 |
23.2% |
||
|
Q4 2013 |
9,274,126 |
18.8% |
9,097,325 |
18.5% |
|
Q1 2014 |
9,065,741 |
17.5% |
9,935,939 |
19.1% |
|
Q2 2014 |
9,074,449 |
17.2% |
9,945,646 |
18.9% |
|
Q3 2014 |
8,135,648 |
15.0% |
10,812,968 |
20.1% |
|
Q4 2014 |
7,052,570 |
12.7% |
11,249,646 |
20.3% |
|
Q1 2015 |
7,341,922 |
13.2% |
11,053,055 |
19.8% |
|
Q2 2015 |
7,443,580 |
13.3% |
10,963,041 |
19.6% |
|
Q3 2015 |
6,917,673 |
12.7% |
10,476,259 |
19.2% |
|
Q4 2015 |
6,436,381 |
11.5% |
12,621,274 |
22.5% |
|
Q1 2016 |
6,703,857 |
12.0% |
12,335,651 |
22.0% |
|
Q2 2016 |
6,666,622 |
11.9% |
12,383,345 |
22.1% |
|
Q3 2016 |
6,063,326 |
10.8% |
13,125,367 |
23.4% |
|
Q4 2016 |
5,408,323 |
9.6% |
13,877,315 |
24.6% |
|
Q1 2017 |
5,497,771 |
9.7% |
13,718,473 |
24.3% |
|
Q2 2017 |
5,433,684 |
9.5% |
14,038,372 |
24.6% |
|
Q3 2017 |
4,628,408 |
8.7% |
14,030,394 |
26.4% |
|
Q4 2017 |
5,032,185 |
9.3% |
13,731,767 |
25.4% |
|
Q1 2018 |
5,206,446 |
9.5% |
13,841,082 |
25.3% |
Properties with 20 to 50 percent equity down by 1.7 million from year ago
More than 19.5 million (19,513,871) U.S. properties had between 20 and 50 percent equity (LTV of between 80 and 50 percent) at the end of Q1 2018, down by 1,714,099 from a year ago, an 8 percent decrease.
Homes with 20 to 50 percent equity represented 36.1 percent of all properties with a mortgage as of the end of Q1 2018, down from 36.3 percent in the previous quarter and down from 37.6 percent in Q1 2017.
Equity rich properties represent one in four properties with a mortgage
More than 13.8 million (13,841,082) U.S. properties with a mortgage were equity rich at the end of Q1 2018, up by more than 122,000 from a year ago but still down from a peak of more than 14 million equity rich properties in Q2 2017.
The 13.8 million equity rich properties represented 25.3 percent of all U.S. properties with a mortgage, down from 25.4 percent in the previous quarter but still up from 24.3 percent in Q1 2017.
Highest share of equity rich properties in coastal California, Honolulu, Seattle
States with the highest share of equity rich homes were Hawaii (41.6 percent); California (41.5 percent); New York (34.8 percent); Washington (33.1 percent); and Oregon (31.8 percent).
Among 98 metropolitan statistical areas with a population of at least 500,000, those with the highest share of equity rich homes were San Jose, California (66.1 percent); San Francisco, California (56.0 percent); Los Angeles, California (45.4 percent); Honolulu, Hawaii (43.1 percent); and Seattle, Washington (39.1 percent).
Highest share of seriously underwater properties in Scranton, Baton Rouge, Youngstown
States with the highest share of seriously underwater homes at the end of Q1 2018 were Louisiana (20.1 percent); Mississippi (18.0 percent); Iowa (17.2 percent); West Virginia (15.9 percent); and Illinois (15.9 percent).
Among 98 metropolitan statistical areas with a population of at least 500,000, those with the highest share of seriously underwater homes at the end of Q1 2018 were Scranton, Pennsylvania (21.9 percent); Baton Rouge, Louisiana (19.9 percent); Youngstown, Ohio (19.5 percent); New Orleans, Louisiana (18.5 percent); and Toledo, Ohio (18.0 percent).
Along with New Orleans, among 51 metro areas with at least 1 million people, those with more than 13 percent of seriously underwater properties were Cleveland, Ohio (16.5 percent); Milwaukee, Wisconsin (16.0 percent); St. Louis, Missouri (14.7 percent); Chicago, Illinois (13.8 percent); Detroit, Michigan (13.6 percent); Virginia Beach, Virginia (13.4 percent); and Kansas City, Missouri (13.4 percent).
Report methodology
The ATTOM Data Solutions U.S. Home Equity & Underwater report provides counts of residential properties based on several categories of equity — or loan to value (LTV) — at the state, metro, county and zip code level, along with the percentage of total residential properties with a mortgage that each equity category represents. The equity/LTV is calculated based on record-level loan model estimating position and balance of loans secured by a property and a record-level automated valuation model (AVM) derived from publicly recorded mortgage and deed of trust data collected and licensed by ATTOM Data Solutions nationwide for more than 150 million U.S. properties.
Definitions
Seriously underwater: Loan to value ratio of 125 percent or above, meaning the property owner owed at least 25 percent more than the estimated market value of the property.
Equity rich: Loan to value ratio of 50 percent or lower, meaning the property owner had at least 50 percent equity.
About ATTOM Data Solutions
ATTOM Data Solutions provides premium property data to power products that improve transparency, innovation, efficiency and disruption in a data-driven economy. ATTOM multi-sources property tax, deed, mortgage, foreclosure, environmental risk, natural hazard, and neighborhood data for more than 155 million U.S. residential and commercial properties covering 99 percent of the nation's population. A rigorous data management process involving more than 20 steps validates, standardizes and enhances the data collected by ATTOM, assigning each property record with a persistent, unique ID — the ATTOM ID. The 9TB ATTOM Data Warehouse fuels innovation in many industries including mortgage, real estate, insurance, marketing, government and more through flexible data delivery solutions that include bulk file licenses, APIs and customized reports.
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