The Real Deal Miami

Miami-Dade’s underwater home rate falls below 20 percent in Q1: report

Las Vegas is now country's worst market for underwater homes

June 09, 2016 03:45PM

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Miami Skyline

Underwater mortgage rates are steadily improving in Miami-Dade County, which was the country’s worst region for negative home equity as recently as end-year 2015.

Of all the county’s outstanding home mortgages during this year’s first quarter, 19.6 percent of them were underwater, meaning those homeowners owed more on their loan than the property itself was worth.

That rate fell by 5.8 percentage points year-over-year, and by 2.3 percentage points since the end of 2015, when Miami-Dade was the biggest hot spot for underwater homes in the nation. Las Vegas now holds that title with a 19.9 percent rate of negative equity, though Miami is still close behind ranking as No. 2.

Rising property values have helped pull many of Miami-Dade’s homeowners from the depths of negative equity, and have also helped buoy others from falling underwater.

Since the market crash when property prices bottomed out, the county recovered much of its value thanks to double-digit appreciations in 2013 and 2014. Price growth has recently slowed to a more nominal rate of 6 to 9 percent year-over-year, depending on the month.

“More than 1 million homeowners have escaped the negative equity trap over the past year,” CoreLogic President and CEO Anand Nallathambi wrote in the report. “ We expect this positive trend to continue over the balance of 2016 and into next year as home prices continue to rise.” — Sean Stewart-Muniz