Q2 report shows Tri-Cities housing market gains equity strength


By DON FENLEY

q2 2014

DataSource: RealtyTrac Q2 Home Equity report.

RealtyTrac’s second quarter Home Equity & Underwater Report shows improvements in the number of Tri-Cities households seriously underwater, the percentage of those resurfacing into an equity status and the number of equity rich households.

Those three categories include roughly one-half of households with mortgages in Carter, Greene, Hawkins, Johnson, Sullivan, Unicoi and Washington counties.

Sullivan County had the highest number of households with a mortgage in the equity rich position.  The definition for equity rich is a property with at least 50% equity.

Nation-wide equity rich properties totaled 18.8%. In Sullivan County the number was 38%, and that was a 2% decline from the first quarter. There are several things that could account for the change. The first is homeowners using their homes equity for the purchase of another home.  A cash-out refinancing is also an option.

Greene County was the only other local county where the Q1 and Q2 equity rich didn’t increase. In that case it was unchanged from the Q1 27% number.

Each of the other counties saw the number of equity rich households increase by 1%.

RealtyTrac defines households that are resurfacing as those with between 10% negative and 10% positive equity.

The category includes 17% of households with a mortgage nationwide.

Four local counties were below the national norm and all but Sullivan and Greene counties added properties from Q1.

Sullivan County’s total was down 2% while was Greene County was down 1%. Johnson and Hawkins counties added 1% each.

Washington County has the highest number of properties with emerging equity and it was 1% lower than it was in Q1.

The number of households that are seriously underwater is defined as those with a loan value is at least 25% higher than its estimated market value. Nation-wide that category included 17% of all properties.

In the Tri-Cities no county was at or above the national norm. And all saw the number of properties in this category decrease in the second quarter.

Unicoi County had the biggest decrease (11%) followed by Johnson and Greene counties at 2%.

“Home price appreciation has slowed in the last few months in many of the markets with the most underwater homes, slowing the pace at which homeowners are recovering equity lost during the Great Recession,” said Daren Blomquist, vice president at RealtyTrac. “For instance, annual home price appreciation in California was at 16% in May 2014 compared to a high of 31% in July and August of 2013. In Arizona, home price appreciation has slowed to 6% annually compared to a high of 24% last year.

“In addition many of the properties that are seriously underwater are in a deep negative equity hole that will take some time to dig out of,” Blomquist continued. “The average loan-to-value on the 9.1 million homes seriously underwater was 133%, and the average loan-to-value on the homes in foreclosure that are seriously underwater was 134%.”

States with the highest percentage of residential properties seriously underwater in the second quarter were Nevada (32 percent), Florida (30%), Illinois (30%), Rhode Island (29%) and Michigan (27%).

©Don Fenley

 

 

 

 

 

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