Nearly one-fourth of Arizona residential properties are "deeply under water," meaning their mortgage balances are 125 percent or more of their market values, a real estate data company reported Thursday.

RealtyTrac Inc., of Irvine, Calif., reported that 403,000 residential properties in the state, or 23 percent, were found to be in the "deeply underwater" category. That would mean, for example, that a house with a mortgage of $125,000 had a value of $100,000.

Forty-six percent of the properties in the category were in some state of foreclosure, RealtyTrac reported.

Residential property values have been on the rebound throughout the state since the depth of the recession, with a 23 percent increase reported for houses in the Phoenix area last year and 16 percent increase in Tucson.