In at least one statistical category, Tennessee's housing markets took a nice step in the right direction in the second quarter, according to research firm CoreLogic. Three months ago, 23 percent of Tennessee properties with a mortgage were in negative-equity territory. As of June 30, that number had fallen to 16.2 percent, a drop significant enough to merit a mention in CoreLogic's national release.

"In the first quarter of 2012, rebounding home prices, a healthier balance of real estate supply and demand, and a slowing share of distressed sales activity helped to reduce the negative equity share," said Mark Fleming, chief economist for CoreLogic. "This is a meaningful improvement that is driven by quickly improving outlooks in some of the hardest hit markets. While the overall stagnating economic recovery will likely slow housing market recovery in the second half of this year, reducing the number of underwater households is an important step toward reducing future mortgage default risk."

To see a detailed map showing negative equity by county, click here.