About 15 percent of Portland area mortgages ‘underwater’

November 24, 2009 5:11 PM ET

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Almost 14 percent of homeowners in Oregon owed more on their mortgages in September than their homes were worth, according to third-quarter data released Tuesday, and in the Portland-Beaverton-Vancouver area, the “underwater” percentage is 14.8.

Those percentages fall well below the national rate of 23 percent of homeowners whose mortgages have negative equity and are deemed “underwater” or “upside down,” according to a report by First American CoreLogic, a California real estate research firm. Negative equity can occur because of a decline in value, an increase in mortgage debt or a combination of both.

Portland and Oregon numbers pale in comparison with some other states, such as Nevada, where 65 percent of all mortgages are considered “underwater,” followed by Arizona (48 percent) and Florida (45 percent). The Portland area ranks 29th. The Los Angeles area ranks No. 1.

The number has been growing as pre-foreclosure activity has risen, the report said. Most of the homeowners facing underwater mortgages financed their properties between 2005 and 2008 and used adjustable-rate mortgages.

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