The Office of Economic Policy

February 17, 2016

Recent housing market indicators suggest that housing activity continues to strengthen. Solid 

residential investment in 2015Q4 contributed 0.3 percentage point to GDP growth.

Meanwhile, home price appreciation has moderated—from a double-digit pace in late 2013 

and early 2014 to a more sustainable mid-single-digit pace now. This moderation occurs as 

high home values, in some areas, challenge affordability for potential homebuyers. In addition, 

home price valuations look to be somewhat elevated relative to pre-bubble norms.

Although some mortgage borrowers continue to struggle in the wake of the crisis, delinquency 

and foreclosure rates are closing in on their pre-crisis ranges. The number of distressed sales

also continues to drop.

Now that most housing market indicators for the entirety of 2015 are available, this month’s 

Housing Dashboard features a special topic reviewing housing market developments in 2015.

HOUSING DASHBOARD
1

February 2016

Pre-bubble 

norm 

(2000-2002 

average) Trough

Current 

level

Current level 

versus prebubble norm 

(2000-2002) 

average

New 921 270 544 14.1% -40.9%

Feb-11 Dec-15

Existing 4,779 3,060 4,820 6.7% 0.8%

Jul-10 Dec-15

New 4.1 12.2 5.2 -0.3 1.1

Jan-09 Dec-15 month(s) month(s)

Existing 4.6 11.3 3.9 -0.4 -0.7

Jul-10 Dec-15 month(s) month(s)

Housing starts 1,289 353 731 10.1% -43.3%

Mar-09 Jan-16

Building permits 1,257 337 720 6.8% -42.7%

Jan-09 Jan-16

115.7 137.3 186.4 5.0% 61.1%

Nov-11 Dec-15

Inflation-Adjusted 111.6 101.9 136.0 6.3% 21.9%

CoreLogic HPI Nov-11 Dec-15

Housing affordability 127 101.1 161.7 -1.0% 27.7%

Jul-06 Dec-15

5 9 8 5 8 6 -1

Jan-09 Feb-16 point(s) point(s)

152 117 158 1 6

Oct-08 Feb-16 point(s) point(s)

1113 100 461 290 -653

2008-Q4 2015-Q4 thousands thousands

67.7 63.5 63.7 -0.8 -4

2015-Q2 2015-Q4 percentage point(s) percentage point(s)

Weakened

Improved

Improved

Improved

Improved

Improved

Housing Market Flash

Wednesday, February 17, 2016

Improved

Improved

Current 12-month 

average versus yearearlier value

Single-family homes

Sales 

(thousands)

Inventory of homes 

available for sale 

(months' supply at current 

sales rate)

Construction activity 

(thousands)

Improved

Weakened

Household formation 

(thousands)

Homeownership rate 

(percent)

Homebuilder 

(NAHB, over 50 means majority view conditions 

positively)

Home-buying conditions 

(Reuters/Umich, index = good time - bad time + 100)

CoreLogic HPI 

w/distressed sales Prices 

(index, Jan 2000 = 100)

Improved

Sentiment

Demographics

Improved

Improved

(NAR, index=100 when median family income qualifies 

for 80% LTV mortgage on a median priced home)

Housing Market Flash
2

February 2016

Housing market activity in 2015 posted solid gains, supported by a stronger labor market, low 

mortgage interest rates, and somewhat improved household formation. Stronger single- and multifamily construction activity contributed to higher residential investment compared with the level seen in 

2014. However, construction activity and construction employment are low relative to their pre-crisis 

levels and relative to the level needed to support typical growth in the number of households and 

demolitions, suggesting that further improvements are likely.

Also, new and existing home sales reached new, post-recession highs in 2015 as housing demand 

strengthened. Home prices rose in 2015, albeit at a more moderate and sustainable pace than in 2014, 

across all major home price indexes. Rising prices helped lift more borrowers from negative equity, 

though in states where home prices are still far below their earlier highs, negative equity remains more 

prevalent.

In the mortgage market, low mortgage interest rates helped support housing demand and home sales 

in 2015. Accordingly, mortgage originations for home purchases increased roughly in line with sales 

activity. However, borrowers, particularly those with less-than-pristine credit histories or low downpayments, continued to face difficulties obtaining a mortgage.

New residential construction activity 

continued to recover and hit an 8-year 

high in 2015. Housing starts increased to 

1.106 million in 2015, the highest level since 

2007. Building permits, a more stable and 

forward-looking indicator of construction 

activity, rose to 1.164 million, also the 

highest total since 2007. As a result, 

residential fixed investment increased 

8.7 percent in 2015, up from just 1.8 percent 

in 2014, and contributed 0.3 percentage 

point to GDP growth.

Home prices grew at a modest pace.

After rising at high single-digit and low 

double-digit rates in 2013, home price 

growth has moderated to expand at low 

single-digit rates in 2015, ranging from a 

3.5 percent for the Zillow Home Values 

Index to 5.4 percent for the FHFA Home 

Price Index. 

Special Topic: 2015 in Review

-24

-16

-8

0

8

16

24

'00 '02 '04 '06 '08 '10 '12 '14 '16

20-City Case-Shiller

FHFA Purchase-Only

CoreLogic

Zillow

Changes in Home Prices 

Source: Standard and Poors, FHFA, CoreLogic, Zillow

12-month percent change 

0.0

0.3

0.6

0.9

1.2

1.5

1.8

2.1

2.4

'00 '02 '04 '06 '08 '10 '12 '14 '16

Housing Starts

Building Permits

Starts and Permits 

Source: U.S. Census Bureau 

Millions
3

February 2016

Mortgage interest rates remained low. 

The average interest rate on new 30-year 

fixed-rate conventional mortgages settled 

was 3.85 percent in 2015, down from 

4.17 percent in 2014, and only slightly 

higher than the 3.66 percent averaged in 

2012. However, mortgage interest rates are 

expected to rise due to the Fed rate hikes in 

2016.

Mortgage applications edged up thanks 

to an increase in purchase activity. The 

MBA Mortgage Applications Index inched 

up 1.6 percent in 2015, largely due to a 

12 percent jump in purchase applications. 

Refinance activity remained muted, with the 

annual average for 2015 4.9 percent below 

its year-earlier level, as many borrowers 

have already refinanced into lower rates.

The median FICO score of newly originated 

mortgages fell slightly in 2015 from around 

760 to around 750, up from roughly 700 in

the early 2000s. At the 10th percentile, the 

FICO score for new mortgages was down to 

642 by the end of 2015, compared with less

than 600 in the early 2000s.

Special Topic: 2015 in Review

median

25th percentile 

10th percentile 

500

550

600

650

700

750

800

'00 '02 '04 '06 '08 '10 '12 '14

Credit Score at Mortgage Origination

Score

Source: FRBNY Consumer Credit Panel/Equifax Note: Credit Score is Equifax Riskscore 3.0; mortgages include first-liens only.

0

30

60

90

120

150

180

210

0

500

1000

1500

2000

2500

3000

'00 '03 '06 '09 '12 '15

Mortgage Applications

Source: Mortgage Bankers Association

Index, 2000:Jan 7 = 100

Purchase (right scale)

Refinance (left scale)

3

4

5

6

7

8

9

'00 '02 '04 '06 '08 '10 '12 '14 '16

Interest Rate of 30 Year Fixed-Rate Mortgages 

Percent

Source: Freddie Mac 
4

February 2016

Residential investment continues to give 

a modest lift to GDP growth. Residential

investment rose at an annual rate of 

8.1 percent in 2015Q4, adding

0.3 percentage point to real GDP growth, 

matching the average contribution over the 

last four quarters. Data through January 

suggest that residential investment is on 

track to make a somewhat smaller gain in 

2016Q1.

Employment in residential construction 

continues to recover. Over the past year,

it has increased by 12,500 jobs per month, 

compared with 13,700 jobs per month in 

the year-earlier period. The level of 

employment remains relatively low: 

residential construction employment 

totaled just over 2.5 million workers in 

2015Q4, accounting for roughly 2.1 percent 

of total private payroll employment, 

compared with around 2.6 percent in the 

early 2000s. 

Housing wealth is nearing its earlier 

peak. The value of household real estate 

reached $22 trillion in 2015Q3, up from a 

low of $16 trillion in 2011Q4. The current 

level is close to its 2006Q4 peak, but the

sustainable level is higher than in 2006 

because of population-driven growth in the 

housing stock and overall inflation. 

Housing’s Importance to the Economy

25

35

45

55

65

75

0

5

10

15

20

25

'00 '02 '04 '06 '08 '10 '12 '14

Market Value of Real Estate (left scale) Net Equity (left scale)

Equity's Share of Value (right scale)

Household Real Estate and Net Equity

Trillions Percent 

Source: Federal Reserve Board 

-10.0

-8.0

-6.0

-4.0

-2.0

0.0

2.0

4.0

6.0

8.0

10.0

'00 '02 '04 '06 '08 '10 '12 '14

GDP (% Change, Annual Rate)

Residential Investment's Contribution

Percent

Residential Investment's Contribution to 

Real GDP 

Source: Bureau of Economic Analysis 

1.5

2.0

2.5

3.0

3.5

4.0

1.5

2.0

2.5

3.0

3.5

4.0

'02 '04 '06 '08 '10 '12 '14

Number Employed (left scale)

Share of Total Private Employment (right scale)

Millions Percent

Employment in Residential Construction 

Note: Includes those employed directly in residential construction as well as related 

specialty trades.

Source: Bureau of Labor Statistics 
5

February 2016

New residential construction activity 

continues on its gradual upward

trajectory despite some recent volatility. 

Single-family starts (light blue line) and 

permits (dark blue line) dipped in

December. In the multifamily sector, 

construction activity is back in the range

seen before the crisis, but the rapid rise in 

rents suggests that construction activity is 

not yet fully meeting demand.

In February, builder confidence fell to a 

9-month low, but remained close to the 

10-year high registered in October. The 

National Association of Homebuilders 

index has recorded readings above 50 

(meaning a majority of builders view the 

market positively) for the last 20 months. 

All three of the index’s components—sales 

expectations over the next six months, 

current sales, and buyer traffic—are above 

their 2014 averages.

The inventory of homes for sale remains 

well below historical averages. The stock 

of existing homes for sale (dark blue line) 

was at 1.79 million units at the end of

December, the lowest level since January 

2013. The stock of new homes for sale 

(light blue line) was at 237,000. At the 

current sales pace, there is 3.9-month 

supply of existing homes available for sale; 

for new homes, the available inventory is 

equivalent to a 5.2-month supply.

Housing Starts and Inventories

0

100

200

300

400

500

600

700

1.0

1.5

2.0

2.5

3.0

3.5

4.0

4.5

'02 '04 '06 '08 '10 '12 '14 '16 Millions Millions Unsold Homes Thousands

Source: National Association of Realtors and U.S. Census Bureau 

Existing (left scale)

New (right scale)

Series average

Series average

0

10

20

30

40

50

60

70

80

'00 '02 '04 '06 '08 '10 '12 '14 '16

Source: National Association of Homebuilders 

Builder Confidence Index

0.0

0.3

0.5

0.8

1.0

1.3

1.5

1.8

2.0

'00 '02 '04 '06 '08 '10 '12 '14 '16

Single-Family Starts

Single-Family Permits Multifamily Starts Multifamily Permits

Source: U.S. Census Bureau 

Millions

Starts and Permits 
6

February 2016

Mortgage interest rates remain very low 

by historical standards. The average 

interest rate on new 30-year fixed-rate 

conventional mortgages settled at a 

9-month low of 3.65 percent in the week 

ending February 11. The current rate is only 

34 basis points higher than the lowest rate 

recorded in 2012.

The National Association of Realtors 

Housing Affordability Index suggests that 

housing remains affordable for the typical 

family. The index declined for the first time 

in five months in December. The rebound in 

house prices accounts for much of the 

decline in affordability since its peak in 2013. 

(Note that the index assumes a 20 percent 

down payment; interest rates would be 

higher and affordability would be lower for a 

family that made a smaller down payment).

Households remain positive about home 

buying conditions. The University of 

Michigan Consumer Survey’s “Good Time to 

Buy” Index remained higher than the longterm average in mid-February. Low interest 

rates continue to be the main factor cited 

when respondents were asked why homebuying conditions are good.

Underpinnings of Housing Demand

80

100

120

140

160

180

200

220

240

'00 '02 '04 '06 '08 '10 '12 '14 '16

Historic Average

(data since 1971)

Record Affordability

Index = 214.5

Home Affordability Index

Source: National Association of Realtors 

3

4

5

6

7

8

9

'00 '02 '04 '06 '08 '10 '12 '14 '16

Interest Rate of 30 Year Fixed-Rate Mortgages 

Percent

Source: Freddie Mac 

100

110

120

130

140

150

160

170

180

'00 '02 '04 '06 '08 '10 '12 '14 '16

Attitudes Towards Buying

Long-Run Average

(data since 1986)

Source: University of Michigan Consumer Survey

Index (Good minus Bad plus 100)
7

February 2016

Senior loan officers at banks report easing of 

mortgage lending standards in recent 

quarters. Despite two quarters of moderate 

tightening at the end of 2014, the last four

quarters mark a period of sustained easing since

the period of dramatic tightening during the 

financial crisis. (Note that the level of the line

shown corresponds to the change in lending

standards, with values below 0 representing an 

easing of lending standards and values above 0 

representing a tightening).

Despite the easing, lending is still restrained,

and riskier borrowers continue to have very 

limited access to mortgage credit. Mortgage

originations have been rising over the past year, 

but the pick-up has been driven largely by

borrowers with credit scores above 780. 

Originations by borrowers with credits scores

below 780 are well below pre-crisis levels. Almost

no mortgages are being extended to borrower

with FICO scores below 660.

The median FICO score of newly originated 

mortgages has fallen slightly in recent quarters to 

around 750, but it is still up from roughly 700 in the

early 2000s. At the 10th percentile, the FICO

score for new mortgages was down to 642 by the 

end of 2015, compared with less than 600 in the

early 2000s.

-40

-20

0

20

40

60

80

100

90 94 98 02 08 10 14

FRB Senior Loan Officer Opinion Survey 

on Mortgage Lending

Tightening

Net Percent of Banks Reporting 

Tightening Standards

Easing

0

200

400

600

800

1,000

Mortgage Originations by Credit Score 

<620 620-659 660-719 720-779 780+

Billions of dollars

Underpinnings of Housing Demand

median

25th percentile 

10th percentile 

500

550

600

650

700

750

800

'00 '02 '04 '06 '08 '10 '12 '14

Credit Score at Mortgage Origination

Score

Source: FRBNY Consumer Credit Panel/Equifax Note: Credit Score is Equifax Riskscore 3.0; mortgages include first-liens only.
8

February 2016

Household formation fell sharply in 

2015Q4. Between mid-2006 and 2014Q3, 

the rate of household formation averaged 

roughly half its historical average of 

1.2 million per year. Household formation 

surged at the end of 2014 and remained 

above its historical average through 

2015Q3. However, household formation 

slowed drastically in the fourth quarter. In 

the year ending in December, just 191,000

households were formed.

The proportion of young adults who are 

working has seen a partial recovery. The 

employment-to-population ratio for 

individuals ages 25-34 has reversed over

half of the decline that occurred during the 

recession. The strengthening labor market

should support household formation going 

forward.

Higher rents are an obstacle to young 

adults establishing their own households. 

The supply of rental housing appears to 

have not risen as fast as demand and, as a 

result, rents have been increasing rapidly. 

They outpaced overall inflation by 

3 percentage points over the year ending in

December. 

-2.5

0.0

2.5

5.0

7.5

'00 '02 '04 '06 '08 '10 '12 '14 '16

Growth in Rents vs. Overall Inflation

Year-over-year percent change

CPI-U: All Items

Source: BLS

CPI-U: Rent of 

Primary Residence

Household Formation 

-0.5

0.0

0.5

1.0

1.5

2.0

2.5

3.0

'00 '02 '04 '06 '08 '10 '12 '14 '16

Historic Average

(data since 1956)

Source: U.S. Census Bureau, Treasury calculation 

Millions Household Formation 

70

72

74

76

78

80

82

84

'00 '02 '04 '06 '08 '10 '12 '14 '16

Employment-to-Population Ratio 

Percent Ages 25-34

Source: Bureau of Labor Statistics
9

February 2016

The homeownership rate edged up in

2015Q4. The homeownership rate was

63.7 percent in 2015Q4, up from 63.5 in 

2015Q2, which was the lowest reading 

since 1967Q4. The homeownership rate 

may stagnate in coming quarters as 

household formation continues to recover

because newly formed households are 

more likely to rent before purchasing a 

home.

First-time home buyers account for 

around half of purchase mortgage 

originations. The share of newly originated 

mortgages going to first-time buyers was 

51.2 percent in December. Smoothing 

through the normal seasonal fluctuations, 

the series appears to be on an uptrend—it 

was 50.2 percent a year earlier. 

87 percent of households headed by 

young adults that are renting say that 

they would prefer to own if they could 

afford it. Of those households, the most 

commonly cited reasons for not owning are 

lack of downpayment (59 percent) and not 

being able to qualify for a mortgage to buy 

a home (35 percent).

59

35

0 10 20 30 40 50 60 70

Cannot afford

downpayment

Cannot qualify

for a mortgage

Percent

Primary Reasons for Renting among 

Young Renters who Prefer to Own

Source: Report on Economic Well-Being of U.S. Households in 2014, Federal Reserve Board 

47

49

51

53

55

'13 '14 '15

Share of Mortgages Accounted by 

Percent First-time Buyers

Source: American Enterprise Institute

Homeownership

60

62

64

66

68

70

'80 '85 '90 '95 '00 '05 '10 '15

Homeownership Rate

Percent

Source: U.S. Census Bureau
10

February 2016

New single-family home sales have 

rebounded in recent months but are 

above their levels of a year ago. At an 

annual rate of 544,000 in December, they 

were 24 percent above their average level in 

2014. New single-family home sales 

averaged 502,000 units for all of 2015, the 

best annual performance since 2007. Still, 

the current pace of sales is still only about 

half the level seen prior to the boom in the 

early 2000s. 

Sales of existing single-family homes

bounced back in December following 

declines in the previous two months, 

which were due in part to new disclosure 

requirements for mortgages originated 

after October 1. The new requirements

have reportedly increased the amount of 

time it takes to close on a sale. Existing 

single-family home sales averaged 5.23 

million units in 2015, up 6.3 percent from 

2014, and the highest annual total since 

2006. (January data will be released on 

February 23).

The National Association of Realtors 

index of pending sales of existing homes 

ticked up in December and was above its 

level of a year ago. The index is a leading 

indicator of existing home sales which are 

recorded at the closing of the sale. The 

National Association of Realtors is 

projecting that existing home sales will rise 

1.5 percent in 2016.

Home Sales

0

200

400

600

800

1000

1200

1400

1600

'02 '04 '06 '08 '10 '12 '14 '16

Thousands New-Single Family Home Sales 

Source: U.S. Census Bureau 

2

3

4

5

6

7

'00 '02 '04 '06 '08 '10 '12 '14 '16

Source: National Association of Realtors 

Millions Existing Single-Family Home Sales 

60

70

80

90

100

110

120

130

'02 '04 '06 '08 '10 '12 '14 '16

Pending Existing Home Sales

Source: National Association of Realtors, Treasury Calculation

Index, 2002: Jan = 100
11

February 2016

After rising at a high single-digit to 

low-double-digit pace in late 2013 and 

early 2014, the pace of home price 

appreciation has eased. Home prices are 

now growing at a more sustainable 

low-to-mid single-digit pace.

Home prices remain below their precrisis peaks. Most measures for the nation 

as a whole are currently around early 2005 

levels. Forecasters generally believe that 

home price appreciation will remain 

moderate going forward. Participants in 

the 2016Q1 Pulsenomics/Zillow home price 

survey expect home prices to rise 

3.7 percent over the four quarters of 2016.

The ratio of home prices to rents, a 

common way to assess whether home 

prices are overvalued, remains well below 

its pre-crisis peak. That said, the 

substantial appreciation of home prices 

since late 2012 has pushed up this ratio, and 

it is now noticeably above its pre-crisis 

range.

0.8

1.0

1.2

1.4

1.6

1.8

2.0

'84 '87 '90 '93 '96 '99 '02 '05 '08 '11 '14

Percent Price-to-Rent Ratio 

Source: Ratio of CoreLogic National Home Price Index to CPI Owner's Equivalent 

Rent. Both Indexes set to 100 in January 1983. 

Home Prices

-24

-16

-8

0

8

16

24

'00 '02 '04 '06 '08 '10 '12 '14 '16

20-City Case-Shiller

FHFA Purchase-Only

CoreLogic

Zillow

Changes in Home Prices 

Source: Standard and Poors, FHFA, CoreLogic, Zillow

12-month percent change 

100

120

140

160

180

200

220

'00 '02 '04 '06 '08 '10 '12 '14 '16

20-City Case-Shiller

FHFA Purchase-Only

CoreLogic

Zillow

Home Prices 

Source: Standard and Poors, FHFA, CoreLogic, Zillow 

Index, January 2000 =100 
12

February 2016

Applications for home purchase 

mortgages have been volatile of late. 

The Fed rate hike and new mortgage 

disclosure requirements may have caused 

fluctuations in recent months. Purchase 

applications remain well below pre-crisis 

levels. Refinancing activity has been very 

low since mid-2013 as most borrowers 

who have been able to refinance have 

already done so.

New mortgage originations have 

increased over the past year but 

remain low by pre-crisis standards. 

New mortgage originations rose to 

$437 billion in 2015Q4, up from a low of 

$354 billion in 2014Q4. The low level of 

mortgage originations stands in contrast 

to the pattern of some other forms of 

household credit, including auto loan 

originations, which have been increasing 

briskly along with sales and now stand 

near the top of their historical range.

The share of new mortgage originations 

backed by the government has fallen since

its 2009 high, but remains significantly

higher than pre-crisis levels. About

70 percent of new mortgages were backed 

by the FHA, VA, or GSEs in the first three 

quarters of 2015 (dark blue and light blue

portions of bars). While bank portfolio 

lending has increased noticeably, the 

private-label mortgage-backed securities

market has experienced essentially no 

recovery since collapsing in late 2007.

0%

20%

40%

60%

80%

100%

'01 '02 '03 '04 '05 '06 '07 '08 '09 '10 '11 '12 '13 '14 2015 Q1-3

Mortgage Originations by Investor

GSE securitization FHA/VA securitization PLS securitization Portfolio

Source: Inside Mortgage Finance and Urban Institute 

Share, percent

Mortgage Originations

0

100

200

300

400

500

600

700

800

900

0

50

100

150

200

250

'04 '06 '08 '10 '12 '14

Auto Loan (Left Axis)

Mortgage (Right Axis)

Source: Federal Reserve Bank of New York 

Billions

New Originated Installment Loan Balances

Billions

0

30

60

90

120

150

180

210

0

500

1000

1500

2000

2500

3000

'00 '03 '06 '09 '12 '15

Mortgage Applications

Source: Mortgage Bankers Association

Index, 2000:Jan 7 = 100

Purchase (right scale)

Refinance (left scale)
13

February 2016

Mortgage foreclosure and delinquency 

rates continue to normalize. The share of

homes in foreclosure declined to 1.9 percent 

of outstanding loans in 2015Q3. The rate of 

mortgages in default (90+ days delinquent 

or in foreclosure) fell to 3.6 percent in 

2015Q3, compared with a pre-crisis average 

of around 2 percent. 

Re-default rates for borrowers who have

received a mortgage modification have

run significantly lower for mortgages that

were modified more recently. Mortgages

that were modified in 2013 (24 months ago)

had re-default rates that were between 32

and 55 percentage points lower than those

modified in 2008. 

The shares of sales represented by REO

sales and short sales have trended down

over the past 3 years. In November 2015, 

REO sales ticked up to nearly 9 percent of 

total sales while short sales remained around 

3 percent.

Delinquencies, Foreclosures and Distressed Sales

0

20

40

60

80

'08 '09 '10 '11 '12 '13

Fannie Mae Freddie Mac

Government-Guaranteed Private

Portfolio Loans Overall

Percent

Re-Default Rate 24 Months after Modification 

Source: OCC Mortgage Metrics Report for Q1-2015 

0

2

4

6

8

10

12

'00 '02 '04 '06 '08 '10 '12 '14

Source: Mortgage Bankers Association and Haver Analytics 

Percent

Foreclosure and Delinquency Rates 

Percent of loans 90 or more days delinquent

Percent of loans in 

foreclosure

Percent of loans 90 days or more delinquent or in 

foreclosure

0

5

10

15

20

25

30

35

'06 '07 '08 '09 '10 '11 '12 '13 '14 '15

Short Sales Share REO Sales Share

Distressed Sales as a Percent of Total Sales 

Source: CoreLogic

Percent 
14

February 2016

Rising home prices have greatly reduced

the number of underwater borrowers. 

The share of mortgage loans with negative

equity was 8.1 percent in 2015Q3, down 

from 10.2 percent in 2015Q1. The number

of homes now underwater stands at

4.1 million, a 66 percent drop since the

2011 peak. Mortgages that are very 

underwater, with negative equity 

exceeding 25 percent, have declined and 

are now 37 percent of all underwater 

mortgages.

The aggregate amount of negative 

equity continues to fall. Since 2010Q1, 

aggregate negative equity has fallen from 

over $800 billion to around $300 billion in 

2015Q3.

Negative equity rates are still very high 

in some states. Around 20 percent of 

mortgaged residential properties in Nevada 

and Florida still have negative equity. 

However, these rates have fallen by more 

than half in these two states since the 

beginning of 2013.

Negative Equity

0

5

10

15

20

25

30

'10 '11 '12 '13 '14 '15

100-105 105-125 125+

Percent 

Share of Loans that are Underwater by 

Loan-to-Value Ratio 

Source: CoreLogic Equity Report, 2015 Q2 

0

200

400

600

800

'10 '11 '12 '13 '14 '15

Amount of Negative Equity 

Billions of dollars 19

17.8

14.6

12.3 12.1

0

2

4

6

8

10

12

14

16

18

20

NV FL AZ RI MD

Negative Equity Share in Top 5 States
15

February 2016

Serious delinquencies have fallen across

the country but the degree of

improvement varies by state. They remain

near peak levels in some states, particularly

in judicial foreclosure states such as New

Jersey and New York. However, serious

delinquencies are down nearly 64 percent

from their peak in Florida, a judicial state

that passed a law in June 2013 speeding up 

the foreclosure process. Serious

delinquencies have also fallen markedly in

hard-hit areas with flexible foreclosure laws,

such as Nevada. 

Foreclosure inventories have declined in

many states but remain relatively high in

others. Judicial foreclosure is an important

factor: 13 of 23 states that employ the practice

have noticeably elevated rates (shaded red).

Other states with high inventories, like Nevada,

are still struggling economically.

State Detail 

0

5

10

15

20

25 NJ NYFL MECTRI MDNVDE MSIL MAPADC OHHI NMINLAVT OKAL KYSC

Q2 2015 value Minimum since Q1 2000 Maximum since Q1 2000

Percent, since Q1 2000 

Serious Delinquencies for 25 Highest-Rate States: Q2 2015 

Source: Mortgage Bankers Association/Haver 

Foreclosure Inventories by State as 

a Percent of All Mortgage Homes

Source: CoreLogic Market Pulse, data as of November 2015