The study says that most underwater communities typically have several things in common. They generally have large African-American and Latino populations and household income well below the national median of roughly $51,000. And the study says that these communities and their residents were the most frequently targeted by predatory loan practices. In 2006, for instance, 52.8 percent of all new home loans to African-American borrowers were classified as "high-price" loans. The figure for all Latino borrowers was 44.9 percent; for whites, it was 17.5 percent.

The report argues that the persistence of deep pockets of negative equity shows that government attempts to deal with the housing crash and subsequent foreclosure crisis have been "woefully inadequate." The paper makes five broad suggestions for immediate action:

Both private lenders and government-sponsored loan holders should reduce the principal on underwater mortgages to current market values.
If loan holders are unwilling or unable to reduce the principal on underwater loans, they should allow the loans to be purchases by public or nonprofit entities that are willing to restructure them.
Local municipalities should use all options at their disposal to facilitate the goal of resetting mortgages to current market values, including the use of "reverse eminent domain" to acquire mortgages in order to restructure them with fair and affordable terms. ("Reverse eminent domain" is the program being attempted in Richmond.)
Lenders and investors who own already-foreclosed homes should sell them to entities that will convert them to affordable housing.
Local municipalities should use all the options at their disposal, including "reverse eminent domain," to facilitate the goal of turning vacant, foreclosed properties into affordable housing.

Here's the complete study, "Underwater America," from the Haas Institute:

negative equitynegative equity

'Underwater' Homes: A Crisis Persists in Bay Area, Nationwide