The share of U.S. borrowers who owe more than their homes are worth fell to less than 20 percent in the first quarter as prices surged in hard-hit markets, according to CoreLogic Inc.
About 850,000 residential properties gained positive equity during the quarter, leaving the number of underwater homes at 9.7 million, or 19.8 percent of all U.S. homes with mortgages. That’s down from 21.7 percent at the end of last year, the Irvine, California-based real estate data provider said today in a report.
Values are rising as buyers compete for tight inventories of properties. U.S. home prices in April jumped 12.1 percent from a year earlier, the largest increase since February 2006, CoreLogic said last week. The biggest jump -- 24.6 percent --was in Nevada, where the owners of 45.4 percent of mortgaged properties are upside down on their homes, more than in any other state.
“The negative-equity burden continues to recede across the country thanks largely to rising home prices,” Anand Nallathambi, president and chief executive officer of CoreLogic, said in a statement today. “We are still far below peak home-price levels, but tight supplies in many areas coupled with continued demand for single-family homes should help us close the gap.”
The aggregate value of negative equity in the U.S. fell to $580 billion in the first quarter from $631 billion at the end of last year.
The majority of home equity is concentrated at the high end of the market, according to CoreLogic. For mortgaged homes valued at more than $200,000, 88 percent are above water, compared with 73 percent for properties worth less than that, the firm said.
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