While the crash of the housing market left many home owners with negative equity, that number has dropped since 2010 from from 25.9% to 7.1% in second quarter of 2016. Business Insider staffer Akin Oyedele takes a look at the part that negative equity played in creating the "new housing crisis," the lack of supply and affordable homes.
As home continue to recover from being underwater, it will likely free up more inventory. This recovery is already being seen in several areas hit hard:
Negative equity is improving even in the states that suffered the most in the housing crash. In the four so-called sand states — Nevada, California, Arizona, and Nevada — which suffered the most in the housing crisis, it has sharply fallen. California...had a lower percentage of mortgaged homes underwater than the national level in the second quarter.