RealtyTrac's full-year U.S. Home Equity & Underwater Report notes that 11.5% of residential properties with mortgage are underwater, down from a peak of 28.6%.
It's important to remember that as monthly S&P/Case Shiller and other home price measures--the ones that reflect actual sales transactions--show gains as a trend, two consequences occur. One is that affordability tolerances get tested, as prices and median household incomes diverge.
The other, though, is that more and more people in homes paying off mortgage loans have been gaining ground in their battle for equity. When more people have equity in their homes, they're more likely to be able to consider selling or buying a new home if their lifestage needs call for it.
The RealtyTrac report looks at underwater vs. equity-rich, vs. nearing the equity tipping point, vs. a newly significant number of homes in foreclosure that actually have regained equity, all on a geographical, regional, and marketplace basis.