Equity positions for most local housing markets higher than national, state levels


Takeaways:

  • At the end of 2015 there were 24,474 area homes that were equity rich.
  • At the same time, there were 8,527 homes that were seriously under water.
  • Of the local homes in foreclosure most have equity, much more than those that are seriously underwater.
Ready475

Q4 share of properties with mortgages.

THE SHARE of local equity-rich homes at the end of 2015 was  considerably  higher than state or national shares  And that equity position for the overall housing market is much stronger when you remember that close to half of all local homes don’t’ have a mortgage.

RealtyTrac’s year-end Home Equity and Underwater Report, shows there were 6.4 million homes with mortgages that were seriously under water representing 11.5% of all properties with a mortgage. Local markets included in the study were: Carter, Greene, Hawkins, Johnson, Sullivan, Unicoi and Washington counties in NE Tenn.  Bristol Va. and Washington County in SW Va.

The report is based on publicly recorded mortgage and deed of trust data collected and licensed by RealtyTrac nationwide along with an industry standard automated valuation model (AVM) updated monthly on RealtyTrac’s entire database of more than 140 million U.S. properties (see full methodology below).

The report shows seriously underwater properties on the national and local level were lower at the end of Q4 than they were in Q3 and Q4 last year.

“Over the past three and a half years, the number of seriously underwater properties has been cut in half, but we continue to deal with a long tail of seriously underwater properties, and it will likely be another five years at least before most of those remaining underwater properties move into positive equity territory,” said Daren Blomquist, vice president at RealtyTrac. “At the other end of the spectrum, the growing number of equity-rich properties reflects a moribund move-up market and restrained leveraging of home equity by U.S. homeowners.”

The national share  of properties that were seriously underwater properties in Q4 is 11.5%. In Tennessee it’s 10.6%. Four local markets had a higher share than U.S.

As of the end of 2015 the number of equity-rich properties was higher than they were in Q3 and Q4 last year.

Locally,  all markets except Bristol VA and Washington VA had a higher share of equity-rich properties.

Sullivan County remains the county with the highest share of equity-rich properties in NE Tenn.

The national share for equity-rich properties is 22.5%. In Tennessee it’s 20.4%

Foreclosure equity share

Q4 2015

The report also shows that 49.7 percent of all homes in foreclosure had some equity, the highest percentage since RealtyTrac began tracking in Q3 2013.

The local share of foreclosures with equity was considerable higher than the national level in all but Bristol, VA. That market’s share was 50%.

The weakest performance of local markets in the equity rich category were Bristol, Va. And Washington Co. Va. Those markets also had the highest share of seriously underwater properties.

Methodology

The RealtyTrac U.S. Home Equity and Underwater report provides counts of residential properties based on several categories of equity — or loan to value (LTV) — at the state, metro and county level, along with the percentage of total residential properties with a mortgage that each equity category represents. The equity/LTV calculation is derived from a combination of record-level open loan data and record-level estimated property value data, and is also matched against record-level foreclosure data to determine foreclosure status for each equity/LTV category.

Definitions

Seriously underwaterLoan to value ratio of 125 percent or above, meaning the homeowner owed at least 25 percent more than the estimated market value of the property.

Equity rich: Loan to value ratio of 50 percent or lower, meaning the homeowner had at least 50 percent equity.

Foreclosures w/equityProperties in some stage of the foreclosure process (default or scheduled for auction, not including bank-owned) where the loan to value ratio was 100 percent or lower.

 

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