The residential real estate market has been on a rollercoaster ride in the United States since the housing market collapsed. Many large cities in the country have seen the housing market improve, which has helped many homeowners get out of their underwater residential mortgages. While many cities and states have seen an improvement, a new report shows that Arizona has one of the highest amounts of underwater homeowners in the country.
CoreLogic reported that Arizona’s negative equity rate was 22.3 percent during the third quarter last year. This is the third-highest negative equity rate in the country, falling behind Nevada and Florida. It is important to note that the national average is much lower with an average of 13 percent.
Arizona has roughly 292,000 homeowners that owe more on their mortgage than what their home is worth, according to the new report. This is a serious issue as having an underwater mortgage makes it difficult to sell the home as well as refinance. Having an underwater mortgage can be very difficult for homeowners to deal with.
Even though Arizona still has a high rate of underwater mortgages, the percentage of homeowners who owe more than what their home is worth has decreased from last year. In the third quarter of 2012, there were more than 509,000 underwater mortgages in the state. Arizona has had the second-highest negative equity rate in the country. The decrease in underwater mortgages in Arizona has been helped by the rising home prices in the area. Increasing home values has helped homeowners gain equity in their home, which is very important for homeowners who owe more than their home is worth.
The residential real estate market in Arizona will continue to change throughout the year, but hopefully the market will continue to improve and help more homeowners in the area.
Source: Phoenix Business Journal, “Arizona still among leaders in underwater homeowners,” Kristena Hansen, Dec. 17, 2013