More than 5.2 million (5,223,524) U.S. properties were seriously underwater at the end of 2019's first quarter, up by more than 17,000 properties from a year ago, according to ATTOM Data Solutions Q1 2019 U.S. Home Equity & Underwater Report. That represented 9.1% of all U.S. properties with a mortgage, up from 8.8% in the previous quarter but down from 9.5% in Q1 2018.
"With home prices increasing at a slower pace in 2018 than in previous years, the potential for people to climb out from mortgages that are underwater or advance into equity-rich territory tends to be reduced," said Todd Teta, chief product officer at ATTOM Data Solutions. "However, only one in 11 mortgages are seriously underwater today, compared to nearly one in three during the depths of the recession. Although, if the latest trend continues, it will raise another clear signal of a market slowdown, which will be good for buyers, but not so good for sellers. But if the pattern of the past few years takes hold – with levels of underwater and equity rich mortgages turning around - it will mean the market remains strong for sellers, with fewer needing to get out from under financial distress."
| Historical U.S. Underwater & Equity Rich Trends | ||||
| Qtr-Yr | U.S. Properties Seriously Underwater | % Seriously Underwater | U.S. Properties Equity Rich | % Equity Rich |
| 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% |
| Q2 2018 | 5,181,467 | 9.3% | 13,907,758 | 24.9% |
| Q3 2018 | 4,940,724 | 8.8% | 14,464,379 | 25.7% |
| Q4 2018 | 5,001,482 | 8.8% | 14,566,363 | 25.6% |
| Q1 2019 | 5,223,524 | 9.1% | 14,401,555 | 25.1% |
States with the highest share of seriously underwater properties were Louisiana (20.7%); Mississippi (17.1%); Arkansas (16.3%); West Virginia (16.2%); and Illinois (16.2%). Among 99 metropolitan statistical areas analyzed in the report, those with the highest share of seriously underwater properties were Baton Rouge, Louisiana (21.3%); Scranton, Pennsylvania (20.0%); Youngstown, Ohio (19.2%); Toledo, Ohio (19.2%); and New Orleans, Louisiana (17.8%).
Among 7,639 U.S. zip codes with at least 2,500 properties with mortgages, there were 32 zip codes where more than half of all properties with a mortgage were seriously underwater, including zip codes in the Milwaukee, Trenton, Chicago, Saint Louis, and Cleveland metropolitan statistical areas. The top five zip codes with the highest share of seriously underwater properties were 53206 in Milwaukee, Wisconsin (70.5% seriously underwater); 08611 in Trenton, New Jersey (68.9%); 69361 in Scottsbluff, Nebraska (63.4%); 60426 in Harvey, Illinois (63.1%); and 61104 in Rockford, Illinois (62.8%).
States with the highest share of equity rich properties were California (43.0%); Hawaii (38.1%); New York (34.2%); Washington (33.2%); and Vermont (32.8%). Among 99 metropolitan statistical areas analyzed in the report, those with the highest share of equity rich properties were San Jose, California (68.3%); San Francisco, California (58.4%); Los Angeles, California (48.1%); Santa Rosa, California (47.6%); and San Diego, California (39.3%).
Among 7,639 U.S. zip codes with at least 2,500 properties with mortgages, there were 408 zip codes where more than half of all properties with a mortgage were equity rich. The top five zip codes with the highest share of equity rich properties were all located in the San Jose and San Francisco markets in California: 94040 in Mountain View (82.3% equity rich); 94116 in San Francisco (81.7%); 94087 in Sunnyvale (81.6%); 94085 in Sunnyvale (81.1%); and 94122 in San Francisco (81.0%).
