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Few Underwater Homes in Austin, Texas

published on September 8, 2016

central austin homesAustin, Texas is among the top United States cities with the highest percentage of homes with positive equity, according to CoreLogic and The Home Story. The San Francisco area leads the way with 99.4% of homeowners having positive equity, with Boulder and Urban Honolulu at 99.1%. Fort Collins came in at 98.6%, with Austin, Fort Worth, and San Jose coming in next with 98.5%. Houston was also in the top ten, with 98.3%.  

“In just the last four years, equity for homeowners with a mortgage has nearly doubled to $6.9 trillion,” said Frank Nothaft, chief economist for CoreLogic. “The rapid increase in home equity reflects the improvement in home prices, dwindling distressed borrowers and increased principal repayment. These are all positive factors that will provide support to both household balance sheets and the overall economy.”

Among the states, Texas had the highest percentage of homes with positive equity, at 98.1%. Alaska was second at 97.8%, Hawaii was third at 97.8%, Colorado was fourth at 97.5%, and Washington was fifth at 97.2%.

Nationally, the percentage of underwater borrowers has fallen as the economy has improved, and now 92 percent of all mortgaged properties have positive equity. In the first quarter of 2016, 46.7 million properties had positive equity levels, while four million had negative equity, meaning the loans were higher than the property value. Factors leading to negative equity can include declines in home values and increases in mortgage debt.

“More than 1 million homeowners have escaped the negative equity trap over the past year,” said CoreLogic President and CEO Anand Nallathambi. “We expect this positive trend to continue over the balance of 2016 and into next year as home prices continue to rise.”