As the nation's real estate market continues to recover, Whatcom County appears to be doing better than many areas when it comes to building home equity.
According to data compiled by RealtyTrac, Whatcom County has a lower percentage of homeowners seriously underwater - owing at least 25 percent more on their mortgages than the property is worth - than the state and national averages. The report indicates 12 percent of Whatcom County residents were seriously underwater, while Washington checked in at 20 percent.
The national average was 23 percent, equating to 10.7 million homeowners seriously underwater. That's down 1.8 million compared to a year ago.
On the other end of the spectrum, 22 percent of Whatcom County homeowners had at least 50 percent equity in their homes. That's higher than the state and national averages, both of which were at 16 percent.
The report can be an early indicator of what will happen to inventory. As more homeowners transition from being underwater to building equity, they are better able to put the home up for sale without going through a short sale situation.
Nationwide, RealtyTrac estimates 8.3 million homeowners are either slightly underwater or slightly above water, putting them on track to be able to sell within the next 15 months without going through the short sale option. In Whatcom County, 9,841 homes are in that break-even equity range.
"Steadily rising home prices are lifting all boats in this housing market and should spill over into more inventory of homes for sale in the coming months," said Daren Blomquist, vice president at RealtyTrac, in a news release accompanying the data.
Prices are on the rise in Whatcom County. The median price for homes and condominiums sold by Whatcom County real estate agents was $253,400 in August, up 6.8 percent compared to a year earlier, said Darin Stenvers, branch manager at the Bellingham John L. Scott office. He expects prices to continue to rise in the coming months, but at a slower rate.
At this point, many who bought locally at the peak in 2004 and 2005 still could be underwater, but those who bought between 2006 and 2008 are around the break-even point, he said.
"Our building boom died down early on in the (real estate) bubble burst, so I don't think home values dropped as much here as some other areas," Stenvers said.
As for the higher-than-average percentage of Whatcom County homeowners with at least 50 percent equity, Stenvers believes this area has a higher number of longtime residents who stay in the same home longer.
"People who didn't have to sell (during the bubble burst) were able to take advantage of lower interest rates," he said, adding that could result in more equity being put into the home.