WASHINGTON - Nearly 10 million Americans remain financially trapped by homes worth less than their mortgage debts, an enduring drag on the U.S. economy almost seven years after the housing bust triggered the Great Recession.
During the first three months of this year, 18.8 percent of homeowners with a mortgage -- 9.7 million -- owed more on their loans than their properties would sell for, according to online real estate database Zillow. Though that was an improvement from the 25.4 percent figure of a year ago, the share of such "underwater" homeowners is about four times the historic average.
The share of mortgage holders with negative equity is projected to drop to 17 percent at the start of next year, according to Zillow.
Several major U.S. metro areas are stuck with residents who have high rates of negative equity. In Chicago, almost 45 percent are underwater or effectively underwater. The rate is 53.1 percent in Atlanta, 50.6 percent in Las Vegas, 46.6 percent in Charlotte, 44 percent in St. Louis and 43.2 percent in Tampa.
Sales of existing homes have slowed after strong growth in the first half of 2013. Americans bought homes at a seasonally adjusted annual rate of 4.59 million in March, the lowest level since July 2012, according to the National Association of Realtors. It was the seventh drop in eight months.
Nationwide, the median sales price in March was $198,500, up 7.9 percent year-over-year. There were nearly 2 million homes for sale at the end of March. But at the current sales pace, that's enough to last only 5.2 months, below the 6 months' supply that's considered normal.
The Realtors will release April sales figures on Thursday. Economists surveyed by FactSet expect a slight 2.2 percent increase in the annual sales rate to 4.69 million.