Report: Fewer Charleston-area homeowners underwater on mortgages due to growing home prices
The number of homeowners in Charleston metro region who owe more than their home is worth has dropped compared to the last three months of 2012, according to a report released today.
In the Charleston-North Charleston-Summerville area, 16.3 percent, or 23,737, of all residential properties with a mortgage were in negative equity as of the first quarter 2013. That’s down from the 19.1 percent, or 27,961 properties, in the fourth quarter of 2012, according to real estate information firm CoreLogic.
The group added that an additional 5.7 percent, or 8,362 residential properties, were near negative equity for first quarter 2013 compared to 6.6 percent, or 9,605, in fourth quarter 2012.
Negative equity, often referred to as “underwater” or “upside down,” means that borrowers owe more on their mortgages than their homes are worth. Negative equity can occur because of a decline in value, an increase in mortgage debt or a combination of both.
Nationwide, 9.7 million, or 19.8 percent of all residential properties with a mortgage, were in negative equity at the end of the first quarter of 2013. That’s down from 10.5 million, or 21.7 percent of all home loans at the end of the fourth quarter of 2012, according to CoreLogic.
The receding number of homeowners underwater is aided by rising home prices, officials said.
“The impressive home price gains of 2012 and the beginning of 2013 have had a big impact on the distribution of residential home equity,” said Mark Fleming, chief economist for CoreLogic. “During the past year, 1.7 million borrowers have regained positive equity. We expect the pent-up supply that falling negative equity releases will moderate price gains in many of the fast-appreciating markets this spring.”
Reach Tyrone Richardson at 843-937-5550 and follow him on Twitter @tyrichardsonPC.