For the third consecutive quarter, a decline in negative equity has been reported, and Massachusetts homeowners are helping lead the nation, with 40 percent holding on to their equity.

The level of negative equity in the nation for the third quarter was reported to be 10.8 million homes, or 22.5 percent, according to a report from CoreLogic. This is a decline from the 11 million, or 23 percent, reported in the second quarter.

Massachusetts is one of five states noted in the report with a high percentage of homeowners that still have equity. Leading the pack was New York (50 percent); other states with high levels of equity included Hawaii (43 percent), Rhode Island (40 percent) and Connecticut (39 percent).

This year showed a decline of more than 500,000 borrowers in negative equity, and 2.4 million borrowers were near negative equity with less than 5 percent equity in the third quarter, according to the report. Combined, negative equity and near-negative equity mortgages accounted for 27.5 percent of all residential properties with a mortgage nationwide.

"Negative equity is a primary factor holding back the housing market and broader economy," said Mark Fleming, CoreLogic chief economist. "The good news is that negative equity is slowly declining, but the bad news is that price declines are accelerating, which may put a stop to or reverse the recent improvement in negative equity."