Overwhelmed homeowners looking for a life raft splashed around to no avail in the third quarter, but they did receive more company. According to Zillow, the amount of underwater homeowners — those who owed more than their home was worth — rose to 28.6 percent from 26.8 percent in the second quarter.

Zillow has been tracking the data since the beginning of 2009, and this is the highest percentage of underwater mortgages in that span. More bad news for the real estate industry came in the form of home prices, which dropped 0.2 percent from the previous quarter and were down 4.4 percent from the same point in 2010.

The message for prospective home buyers remains the same — If you like the price on a house you find, you’ll like it even better the longer you wait.

U.S. ‘Underwater’ Homeowners Increase to 28.6%, Zillow Reports [Zillow via Bloomberg Businessweek]

Previously: 28.4% Of All Homes Are Underwater

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