About 4.3 million of 46.3 million, or 10.7% of, mortgaged residential properties in the U.S. are underwater--meaning they have a mortgage amount greater than the property value--at the end of the third quarter of 2015. This is an alarming sign for the housing market. 24/7 Wall St staffer Paul Ausick drills down into the data and unveils five metropolitan areas in the U.S. with the most underwater mortgages. Ausick writes,
Some 18.9% (approximately 9.5 million) of all mortgaged properties have positive equity of less than 20%, and 2.3% had less than 5% positive equity at the end of the fourth quarter. The percentage of homes with less than 20% positive equity is slightly higher than at the end of the third quarter of 2015 when 17.6% of all properties had positive equity below 20%. Homes with less than 5% equity are also higher, 2.3% at the end of the fourth quarter compared with 2.3% in the prior quarter.
The aggregate value of negative equity fell by $37.4 billion year over year in the fourth quarter to a nationwide total of $311 billion. At the end of the third quarter, the aggregate value of underwater property totaled $301 billion.
The five metropolitan areas with the highest percentage of properties with negative equity are:
- Miami-Miami Beach-Kendall, Fla. (22.0%)
- Las Vegas-Henderson-Paradise, Nev. (21.3%),
- Chicago-Naperville-Arlington Heights, Ill. (16.7%)
- Washington, DC-Arlington-Alexandria, Va. (11.0%)
- Boston, Mass. (6.3%)
The five metro areas with the highest percentage in positive equity are: