Nearly 40 percent of homeowners in the Puget Sound area owe are underwater on their mortgage, according to Seattle-based real estate website Zillow. About nine percent of those owe more than double what their home is actually worth.

The findings are part of a nationwide first quarter 2012 negative equity report. It found 49.2 percent of Pierce County homeowners are underwater, followed by Snohomish County at 47.2 percent and King County at 32.7 percent..

Zillow says 37.2 percent of Seattle-area homeowners were underwater by 20 percent or less; 26 percent were underwater by 21 to 40 percent; 15.9 percent were underwater by 41 to 60 percent; 8.3 percent were underwater by 61 to 80 percent, and; 4 percent were underwater by 81 to 100 percent.

Nearly nine percent of Seattle-area homeowners owe more than double what their home is actually worth. That s about twice the national average.

16 million homeowners across the country were underwater in the first three months of the year, owing a collective $1.2 trillion more than their homes were worth. That s 31.4 percent of U.S. homeowners with mortgages, a slight increase from the 31.1 percent for the fourth quarter of 2011

Despite the news, the vast majority of homeowners are getting their bills paid. Nine out of ten homeowners nationwide continue to make their mortgage payments on time and only 10.1 percent are more than 90 days delinquent.

Zillow says negative equity remained high despite increasing home values. It adds that foreclosues cause homes to come out of negative equity when a bank or third party takes ownership.

While it was disappointing to see negative equity numbers remain so high, it is important to note that negative equity remains only a paper loss for the vast majority of underwater homeowners, said Zillow Chief Economist Stan Humphries. As home values slowly increase and these homeowners continue to pay down their principal, they will surface again.

Humphires warns that if economic growth slows and unemployment rises, that will lead to homeowners failing to make payments, thus increasing the risk of more foreclosures.

Here s a look at how Seattle compares to other major metropolitan areas. The number shown is the percentage of homeowners who were underwater in the first quarter of 2012.

  • Seattle 39.6 percent
  • United States 31.4 percent
  • Portland 34.3 percent
  • Las Vegas 71 percent
  • Phoenix 55.8 percent
  • Atlanta 55.2 percent
  • Orlando 53.9 percent
  • Sacramento 51.2 percent
  • Detroit 49.8 percent
  • Tampa 48.3 percent
  • Miami-Fort Lauderdale 46.4 percent
  • Chicago 41.1 percent
  • Minneapolis-St. Paul 39.9 percent
  • Charlotte 36.6 percent
  • San Diego 35.6 percent
  • Cleveland 33.9 percent
  • Washington, DC 32.4 percent
  • Baltimore 31.4 percent
  • San Francisco 30.7 percent
  • Dallas-Forth Worth 30.7 percent
  • St. Louis 30.7 percent
  • Los Angeles 30 percent
  • Denver 29 percent
  • Philadephia 25 percent
  • New York 21.3 percent
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