Negative equity levels have declined in every state across the nation as of the end of 2013’s second quarter, reports CoreLogic’s October MarketPulse, with the biggest improvements concentrated in states with the most home price appreciation.
Home prices had risen 12% as of July 2013 compared to the prior year, according to CoreLogic’s national Home Price Index. During the second quarter, the share of borrowers in negative equity fell by around 2.5 million to 7.1 million borrowers.
“The bulk of the decline in negative equity has been confined to the first half of this year when home prices increased 10%,” says the MarketPulse. “While every state’s negative equity level has improved, the biggest gains have been concentrated in the states with the most appreciation.”
Nevada topped that list, with its share of negative equity falling from more than 52% in the fourth quarter of 2012 to 36.4% in the second quarter of 2013. In Georgia, the negative equity share dropped from 34.7% to 20.7% during the same time period.
“The improvements have been so robust that, as of the second quarter of 2013, 21 states have negative equity below 10 percent versus just 11 states as of the fourth quarter of 2012,” CoreLogic notes.
Looking ahead, CoreLogic expects home prices to increase 6% in the next 12 months. This will contribute to negative equity levels continuing to improve, the MarketPulse says, though at a “much more moderate pace” of roughly four to five percentage points throughout 2014.
Read CoreLogic’s October 2013 MarketPulse.
Written by Alyssa Gerace