Over the past few years I’ve heard so very much about “underwater homes”. When one owes more than the home is worth, the choices seen a bit stark. Short-Sales, foreclosures, bankruptcies, and other dire options were what got press, and agents talking. There was one option, though, that didn’t get mentioned: nothing. Keep pushing your mortgage and wait for the market to recover value.
The past several years have seen significant value growth. And Seattle has been central in that growth trend. We’ve gained back most, if not all, of the recession’s value erosion. Now, that’s not universal. There are areas in western Washington which haven’t gained that much. Seattle/Bellevue is the epicenter, which price increases dropping moving outwards.
Now, if you must move (job relocation, etc), you can’t afford your mortgage (adjustable rate resets, interest only terms off and principle comes due, etc), and you owe me than your home’s value, there are options. Don’t panic! But don’t seek one of these options if you simply are worried about home value. If you like where you live and it meets your needs, stay there. Prices will recover, and soon.
