Today more than a quarter of all homeowners are "underwater." That is, the value of their house is less than what they owe in mortgage payments. That means 10.7 million people with negative equity in their homes. Ruth Simon and James Hagerty of the Wall Street Journal explain the larger implications:

These so-called underwater mortgages pose a roadblock to a housing recovery because the properties are more likely to fall into bank foreclosure and get dumped into an already saturated market. Economists from J.P. Morgan Chase & Co. said Monday they didn't expect U.S. home prices to hit bottom until early 2011, citing the prospect of oversupply.

Which states have the highest percentage of "negative equity"? MichiCaliFlAriVada, of course.

For months, Atlantic Business has been following the sad states of Michigan, California, Florida, Arizona and Nevada -- or, collectively, Michicaliflarivada. Some or all of those states are tops in the nation in unemployment, foreclosure rates, and credit card debt. Now the five states with the percentage of underwater homeowners are, in order, Nevada, Arizona, Florida, Michigan and California -- the whole crew. Unbelievably, about half of homeowners in Arizona and Florida have negative equity, and in Nevada sixty-five percent are underwater.

If you'd like a better grasp of the homeowner crisis, check out this useful (I hesitate to call it "fun" considering the content) chart.