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TH E M R EP O RT | 53 O R I G I NAT I O N S E R V I C I N G DATA G O V E R N M E N T S E C O N DA R Y M A R K E T DATA THE LATEST Rising Equity Levels Are Restoring Balance As more homeowners rise from underwater, the housing market becomes more fluid. T he U.S. housing market has experienced a spike in equity-rich home- owners. According to the U.S. Home Equity and Under- water report curated by ATTOM Data Solutions, over 13 million homeowners have reached equity- rich status in the third quarter of 2016, which is up by 2.6 million from Q 3 2015. ATTOM defines equity rich as having an LTV ratio of 50 percent or lower. The increase in equity-rich homeowners has a positive impact on the housing market by bringing fluidity back into the marketplace. Daren Blomquist, SVP at ATTOM Data Solutions, told MReport, "The declining number of homeown - ers in negative equity means the housing market is finally get- ting close to digging itself out of the deep hole resulting from the housing crash. More homeowners will regain enough equity to sell, helping to loosen up the inventory logjam that has been in place over the past couple of years." Blomquist expects the number of underwater homeowners to drop to 5 percent, which will be another step toward restoring balance be - tween buyers and sellers and creat- ing a healthier housing market. The U.S. Home Equity and Underwater report stated that almost one in every five home - owners with a mortgage is equity rich. This is a result of an increase in homeownership tenures and rising home prices. The average homeownership tenure has in- creased to almost eight years. "Median home prices increased on a year-over-year basis for the 18th consecutive quarter in Q 3 2016, and homeowners who sold in the third quarter had owned their home an average of 7.94 years—a new high in our data and substantially higher than the average homeownership ten - ure of 4.26 years pre-recession," Blomquist said. "As homeowners stay in their homes longer before moving up, they are amassing more equity wealth." ATTOM's numbers follow posi - tive trends in the mortgage mar- ket. The number of homeowners who are seriously underwater has decreased by more than 800,000 since 2016. Approximately 6.7 million homeowners are seriously underwater, which represents 10.6 percent of U.S. homeowners with a mortgage—approximately half of the total of underwater homeowners at their peak in Q2 2012 (12.8 million). Over 20 percent of homes are underwater in Las Vegas (25.0); Akron, Ohio (24.2); and Detroit (20.0). Cities with the highest share of equity-rich owners include San Jose (55.7 percent), San Francisco (49.8 percent), and Honolulu (39.3 percent). Other cities on the list are Los Angeles (38.2), Pittsburgh (34.5), Portland (33.1), San Diego (33.0), Oxnard-Thousand Oaks- Ventura, California (32.7), Seattle (31.5), and Austin (31.0). Source:: Black Knight Financial Services October 2016 Mortgage Monitor AROUND THE U.S. Current, Performing, and Up-to- Date T he nationwide share of current and perform- ing residential mort- gage loans has been steadily improving over the last few years. In October 2016, the national performing mortgage share hit nearly 95 percent, as the percentage non-current mortgages experienced a decline of more than 13 percent over-the-year. All but 13 states experienced a double-digit year-over-year decrease in non- current mortgages in October 2016. One factor behind the improved mortgage performance is higher credit quality of mortgage loans originated from 2012 to 2016, ac - cording to Black Knight. "The pristine credit quality of recent vintage mortgages continues to bring overall non-current rates down," said Ben Graboske, Black Knight EVP of Data and Analytics. "In fact, the inflow of new troubled loans has returned to pre- recession levels, and over the past six months, default rates have been 13 percent below long-term norms on average. Meanwhile, foreclosure inventories are declining at rates of 30 percent annually or more, and that pace is accelerating. All in all, this is contributing to a continued trend of improvement. Finally, the robust employment picture is help - ing those already in mortgages to remain current." Another driver of the increased share of current mortgages is a spike in refinance originations—which historically perform better than purchase mortgage loans—in the last two years. A large number of these refinances during the 2016 boom went to borrowers with higher credit scores, Black Knight reported. North Dakota 97.8% 4.3% Colorado 97.6% -19.9% Minnesota 97.3% -12.3% Montana 97.1% -12.3% Idaho 97.0% -17.8% Alaska 97.0% 19.3% South Dakota 97.0% -6.9% California 96.8% -16.9% Oregon 96.8% -22.4% Washington 96.7% -23.7% Arizona 96.5% -12.3% Utah 96.4% -16.6% Wyoming 95.8% 1.9% Virginia 95.7% -9.7% Iowa 95.6% -10.1% New Hampshire 95.5% -13.9% Nevada 95.3% -23.6% Wisconsin 95.3% -14.0% Michigan 95.3% -10.5% District of Columbia 95.3% -14.9% Missouri 94.9% -12.1% National Average 94.7% -13.6% Illinois 94.7% -15.4% Vermont 94.6% -5.7% Kentucky 94.6% -13.4% Kansas 94.6% -9.2% Massachusetts 94.5% -17.5% North Carolina 94.4% -10.7% Hawaii 94.1% -18.1% New Mexico 94.0% -13.6% Texas 94.0% -8.2% Ohio 93.8% -12.0% Maryland 93.7% -13.6% Florida 93.6% -18.7% Tennessee 93.6% -13.1% Georgia 93.5% -10.6% South Carolina 93.4% -10.6% Connecticut 93.4% -11.5% Delaware 93.3% -14.1% Pennsylvania 93.1% -11.4% Arkansas 93.1% -11.8% Indiana 93.0% -11.4% Oklahoma 92.9% -6.6% Maine 92.7% -16.5% Rhode Island 92.7% -18.2% Nebraska 92.3% -14.8% New York 92.2% -13.5% West Virginia 92.2% -5.6% Alabama 92.1% -9.3% New Jersey 91.9% -18.9% Louisiana 89.8% -2.6% Mississippi 88.8% -9.7% Current and Performing Year-over- year-change in non-current mortgages