Drop in Bay Area underwater homes accelerates
Pete Carey | Mercury News | November 11, 2013 | link
In a promising sign for the Bay Area’s housing recovery, the number of underwater homes in the region fell at the fastest rate in at least two years during the third quarter, according to a report released Wednesday.
The drop pulled 42,000 homes in the East Bay, Peninsula and South Bay into the black, so that their homes are worth more than the mortgages on them, the online real estate company Zillow reported.
Only Contra Costa County is at roughly the national average of one in five homes in negative equity, Zillow said.
“The movement is unalloyed great news for the housing market,” said Zillow’s chief economist, Stan Humphries.
In the past year, 103,000 homes have emerged from underwater status in the four counties of San Mateo, Santa Clara, Alameda and Contra Costa, Zillow said.
“What’s helping the Bay Area market is the fact that it’s seeing enormous home value appreciation,” Humphries said. “That helps pull negative equity down pretty quickly.”
Bay Area home values are up about 25 percent over the past 12 months.
“That’s three or four times the national average,” Humphries said.
Only 13.3 percent of Alameda County homes were underwater in the third quarter, down from 19.3 percent in the second quarter, Zillow said. In Contra Costa County, 19 percent were underwater, down from 26.8 percent. Santa Clara County dropped from 10.6 percent to 7.2 percent and San Mateo went from 9.8 percent to 6.8 percent.