Eighty-nine percent of all U.S. properties with a mortgage — or about 44.5 million — had equity by the end of the fourth quarter of 2014, according to CoreLogic.
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If home prices rise by 5 percent, an additional 1 million home owners currently in negative equity could come back into the black.
The majority of properties with equity are concentrated at the high end of the housing market, according to the report. Ninety-four percent of homes valued at more than $200,000 have equity compared with 84 percent of homes valued less than $200,000.
While more home owners are regaining equity overall, the number with negative equity is still high.
"Negative equity continued to be a serious issue for the housing market and the U.S. economy at the end of 2014, with 5.4 million home owners still underwater," says Anand Nallathambi, president and CEO of CoreLogic. "We expect the situation to improve over the course of 2015."
The states with the highest number of properties in negative equity in the fourth quarter were:
On the other hand, the following states had the most homes with (positive) equity: