Rising Negative Equity Puts More Than One in Four Underwater

After declining between the first and second quarters of this year, Zillow says negative equity rose again in the third, reclaiming all of the previous quarter’s decline and then some.
Zillow’s latest market analysis indicates 28.6 percent of American homeowners with a mortgage owed more on the loan than their home was worth as of the end of September. That’s up from 26.8 percent in the second quarter and 28.4 percent in the first quarter.
Dr. Stan Humphries, Zillow’s chief economist, explains that negative equity fell in the second quarter on the basis of sharp improvements in depreciation rates and flat foreclosure liquidation rates.