San Jose Mercury
From the article:
Rising prices pushed thousands of Bay Area homes back above water last year, according to a report released Wednesday, another sign that the region's housing crisis is easing as the economy recovers.
The report, by the housing website Zillow, shows drops across the region in the number of homes that are underwater -- worth less than the value of their mortgages.
More than 56,826 homes bobbed back above water across seven counties of the Bay Area in 2012, Zillow reported. That still leaves 205,986 homes with a total negative equity of $31.5 billion. And that negative equity is keeping thousands of homes off the market, forcing buyers to compete for whatever comes up for sale.
A dozen wealthy Silicon Valley and Peninsula communities from Belmont to Los Gatos have already returned to pre-crash home prices, the company said. Zillow is forecasting continued growth in prices this year, followed by a leveling off in 2014. The company uses a proprietary formula to calculate home values.
In the last three months of 2012, a little more than one-third of Contra Costa County's homes that had mortgages were underwater, Zillow reported. That was down from 41.3 percent a year earlier. The figure for Alameda County was 25.4 percent, down from 31 percent a year earlier, while Santa Clara dropped to 15 percent from 22 percent in the fourth quarter of 2011.