SOURCE: ATTOM Data Solutions

ATTOM Data Solutions

November 17, 2016 00:01 ET

Equity Rich U.S. Homeowners Increase by 2.6 Million in Q3 2016 as Average Homeownership Tenure Reaches a New High

Home Prices Up for 18th Straight Quarter; Average Homeownership Tenure Nearly 8 Years; More Than 20 Percent of Homeowners Still Underwater in Las Vegas, Cleveland, Detroit

IRVINE, CA--(Marketwired - November 17, 2016) - ATTOM Data Solutions, curator of the nation's largest fused property database, today released its Q3 2016 U.S. Home Equity and Underwater Report, which shows that 13,125,367 U.S. homeowners were equity rich (loan-to-value ratio of 50 percent or lower) as of the end of Q3 2016, representing 23.4 percent of all U.S. homeowners with a mortgage and an increase of more than 2.6 million from a year ago.

The report also shows that 6,063,326 U.S. homeowners were seriously underwater (LTV of 125 or higher) as of the end of Q3 2016, representing 10.8 percent of all U.S. homeowners with a mortgage, and a decrease of more than 854,000 homeowners from a year ago. Since the peak in seriously underwater homeowners at 12.8 million representing 28.6 percent of all homeowners with a mortgage in Q2 2012, the number of seriously underwater homeowners has decreased by more than 6.7 million.

"Close to one in every five U.S. homeowners with a mortgage is now equity rich thanks to a combination of rising home prices and lengthening homeownership tenures," said Daren Blomquist, senior vice president at ATTOM Data Solutions, the new parent company of RealtyTrac. "Median home prices increased on a year-over-year basis for the 18th consecutive quarter in Q3 2016, and homeowners who sold in the third quarter had owned their home an average of 7.94 years - a new high in our data and substantially higher than the average homeownership tenure of 4.26 years pre-recession. As homeowners stay in their homes longer before moving up, they are amassing more home equity wealth."

 
Historical Seriously Underwater & Equity Rich Trends
             
Qtr-Year  Percent Seriously Underwater  Total Underwater  Equity Rich  Pct Equity Rich
Q1 2012  27.8%  12,533,155      
Q2 2012  28.6%  12,824,279      
Q3 2012  27.6%  12,472,262      
Q1 2013  25.8%  10,894,743      
Q2 2013  25.7%  11,336,033      
Q3 2013  23.2%  10,714,924      
Q4 2013  18.8%  9,274,126  9,097,325  18.5%
Q1 2014  17.5%  9,065,741  9,935,939  19.1%
Q2 2014  17.2%  9,074,449  9,945,646  18.9%
Q3 2014  15.0%  8,135,648  10,812,968  20.1%
Q4 2014  12.7%  7,052,570  11,249,646  20.3%
Q1 2015  13.2%  7,341,922  11,053,055  19.8%
Q2 2015  13.3%  7,443,580  10,963,041  19.6%
Q3 2015  12.7%  6,917,673  10,476,259  19.2%
Q4 2015  11.5%  6,436,381  12,621,274  22.5%
Q1 2016  12.0%  6,703,857  12,335,651  22.0%
Q2 2016  11.9%  6,666,622  12,383,345  22.1%
Q3 2016  10.8%  6,063,326  13,125,367  23.4%
         

San Jose, San Francisco, Honolulu with highest share of equity rich homeowners

Among 88 metropolitan statistical areas with a population of at least 500,000 or more, those with the highest share of equity rich homeowners were San Jose (55.7 percent); San Francisco (49.8 percent); Honolulu (39.3 percent); Los Angeles (38.2 percent); and Pittsburgh (34.5 percent).

Other metro areas in the top 10 for highest share of equity rich homeowners were Portland (33.1 percent), San Diego (33.0 percent); Oxnard-Thousand Oaks-Ventura, California (32.7 percent); Seattle (31.5 percent); and Austin, Texas (31.0 percent).

There were seven metro areas where the share of equity rich homeowners increased by more than 10 percentage points from a year ago in Q3 2016: San Francisco (up 11.9 percentage points); San Jose (up 11.9 percentage points); Cape Coral-Fort Myers, Florida (up 11.5 percentage points); Portland, Oregon (up 11.2 percentage points); Denver (up 11.2 percentage points); Austin, Texas (up 10.8 percentage points); and Seattle (up 10.8 percentage points).

"The percentage of equity rich households in the Seattle area took off at the end of last year and has been rising at an impressive rate ever since then, especially when compared to the country as a whole - which has seen a far more modest increase than we have locally," said Matthew Gardner, chief economist at Windermere Real Estate, covering the Seattle market. "This growth in home equity wealth will likely lead to an increase in cash-out refinancing in our market, but more importantly, it will serve to protect Seattle homeowners from any unforeseeable shocks that might arise in the future."

More than 20 percent of homeowners underwater in Las Vegas, Cleveland, Detroit

The share of seriously underwater homeowners was 20 percent or higher in seven of the 88 metro areas analyzed in the report: Las Vegas (25.0 percent); Akron, Ohio (24.2 percent); Cleveland, Ohio (22.8 percent); Toledo, Ohio (21.7 percent); Dayton, Ohio (20.2 percent); Detroit (20.0 percent); and Lakeland-Winter Haven, Florida (20.0 percent).

Other markets in the top 10 for highest share of seriously underwater homeowners were Chicago (19.5 percent); Kansas City (18.4 percent); and Memphis (18.3 percent).

Counter to the national trend, the share of seriously underwater homeowners increased from a year ago in 21 of the 88 metro areas analyzed, including Akron, Ohio; McAllen-Edinburg-Mission, Texas; Baton Rouge, Louisiana; Scranton-Wilkes-Barre-Hazleton, Pennsylvania; and Little Rock, Arkansas.

17 ZIP codes with two-thirds of homeowners underwater

Among 6,911 U.S. ZIP codes analyzed in report, 17 posted seriously underwater rates of 66 percent or higher, including ZIP codes in the following metro areas: Chicago, St. Louis, Detroit, Columbus, Ohio; East Stroudsburg, Pennsylvania; Trenton, New Jersey; Cleveland, and Milwaukee.

 
Top 17 ZIP Seriously Underwater ZIP Codes
             
ZIP  City  Metro Area  Properties Seriously Underwater  Percent Seriously Underwater
60827  Riverdale  Chicago-Naperville-Elgin, IL-IN-WI  3,945  74.6%
63137  Saint Louis  St. Louis, MO-IL  4,403  74.1%
48235  Detroit  Detroit-Warren-Dearborn, MI  7,261  73.1%
43211  Columbus  Columbus, OH  4,583  71.0%
18466  Tobyhanna  East Stroudsburg, PA  3,363  70.5%
48228  Detroit  Detroit-Warren-Dearborn, MI  7,484  70.3%
60064  North Chicago  Chicago-Naperville-Elgin, IL-IN-WI  2,008  69.8%
60419  Dolton  Chicago-Naperville-Elgin, IL-IN-WI  4,740  69.5%
48224  Detroit  Detroit-Warren-Dearborn, MI  6,571  69.2%
08611  Trenton  Trenton, NJ  3,062  68.9%
44137  Maple Heights  Cleveland-Elyria, OH  5,220  68.5%
48227  Detroit  Detroit-Warren-Dearborn, MI  5,759  68.3%
60471  Richton Park  Chicago-Naperville-Elgin, IL-IN-WI  2,369  68.1%
63136  Saint Louis  St. Louis, MO-IL  8,551  68.0%
48205  Detroit  Detroit-Warren-Dearborn, MI  5,549  67.7%
48219  Detroit  Detroit-Warren-Dearborn, MI  7,041  66.3%
53206  Milwaukee  Milwaukee-Waukesha-West Allis, WI  2,118  66.2%
         

Report methodology

The ATTOM Data Solutions U.S. Home Equity & Underwater report provides counts of properties based on categories of equity -- or loan to value (LTV) -- at the state, metro, county and zip code 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 underwater: Loan 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.

About ATTOM Data Solutions

ATTOM Data Solutions is the curator of the ATTOM Data Warehouse, a multi-sourced national property database that blends property tax, deed, mortgage, foreclosure, environmental risk, natural hazard, health hazards, neighborhood characteristics and other property characteristic data for more than 150 million U.S. residential and commercial properties. The ATTOM Data Warehouse delivers actionable data to businesses, consumers, government agencies, universities, policymakers and the media in multiple ways, including bulk file licenses, APIs and customized reports.

ATTOM Data Solutions also powers consumer websites designed to promote real estate transparency: RealtyTrac.com is a property search and research portal for foreclosures and other off-market properties; Homefacts.com is a neighborhood research portal providing hyperlocal risks and amenities information; HomeDisclosure.com produces detailed property pre-diligence reports.

ATTOM Data and its associated brands are cited by thousands of media outlets each month, including frequent mentions on CBS Evening News, The Today Show, CNBC, CNN, FOX News, PBS NewsHour and in The New York Times, Wall Street Journal, Washington Post, and USA TODAY.

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