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Report picks out divergence in US housing wealth
MORE than a decade after the recession, one in 11 mortgaged properties in the United States is considered "seriously underwater", according to the home equity report by ATTOM Data Solutions.
This equates to more than 5.2 million properties where the combined balance of loans secured by the property was at least 25 per cent higher than the property's estimated market value - an increase of almost 600,000 from the post recession low reached in the third quarter of 2017.
In 32 zip codes, with a minimum of 2,500 mortgaged properties in each, more than half are "seriously underwater".
"With home prices increasing at a slower pace in 2018, than in previous years, the potential for people to climb out from mortgages that are underwater or advance into equity-rich territory, tends to be reduced," said Todd Teta, chief product officer at ATTOM Data Solutions.
The top five zip codes with the highest share of seriously underwater properties were 53206 in Milwaukee, Wisconsin (70.5 per cent seriously underwater); 08611 in Trenton, New Jersey (68.9 per cent); 69361 in Scottsbluff, Nebraska (63.4 per cent); 60426 in Harvey, Illinois (63.1 per cent); and 61104 in Rockford, Illinois (62.8 per cent).
Among the same cohort of 7,639 US zip codes, 408 of them are "equity rich" - so classified when the loan-to-value ratio is 50 per cent or lower for more than half of all properties in the area.
Not only do California zip codes dominate the list numerically, they also occupy the top of the ranks by taking 89 of the top 100 spots. These 89 California zip codes hold 471,696 properties where the property owner had at least 50 per cent equity. BLOOMBERG