Chicago’s predominantly minority communities struggle with more negative equity and underwater properties than white communities, according to a study from the Woodstock Institute.

In predominantly African-American areas of Chicago, 40.5% of borrowers struggled with underwater properties with 5.4% close to the underwater level. In Latino-centric communities, 40.3% of borrowers suffered from negative equity while 4.4% were almost there.

The number of these negative equity homes looked especially lopsided in minority-majority areas when compared to white communities, which only showed 16.7% of homes underwater.

Looking at the metro area as a whole, not quite one in four homeowners with mortgages were underwater with close to $24 billion in negative equity, making an average of $60,987 of negative equity for every residential property in the six-county region.

“The destruction of assets caused by negative home equity may disproportionately threaten the economic security of people of color because home equity is a larger proportion of their net worth than it is for whites,” the report said.

The research compiled data on home equity, property values and outstanding mortgage debt on homes in the six counties of the Chicago metro area for 2011. In conjunction with 2010 census data on the racial and ethnic composition of ZIP codes, the two data sets produced a loan-to-value ratio related specifically to the ethnic composition of different areas.

The LTV ratio, which divides mortgages by value, shows that the percentage stands out most in highly African-American communities at 92.1%, which surpasses Latino communities at 87.4%, white communities at 67.7% and the Chicago six-county region as a whole at 72.3%.

“As policymakers design and allocate resources for foreclosure prevention and neighborhood stabilization programs, concentrated negative equity will impact the outcomes of these initiatives,” said Spencer Cowan, vice president of the Woodstock Institute. “Reducing negative equity will be an important step toward stabilizing communities hit hard by the foreclosure crisis.”

The report recommended use of principal reduction and stream-lined short sales, suggesting the Federal Housing Finance Agency should make loans backed by Fannie Mae and Freddie Mac eligible for principal write-downs.