Learned to Swim Yet?

If you bought your Contra Costa County house in 2005 or later, the chances are better than 50-50 that you’re underwater. What does that mean? It means the house is worth less than the mortgage, which effectively means you can’t move until prices come back up without losing money…usually a lot of money.

About two out of three East Bay homes that were bought since 2005 are now worth less than the mortgages on the houses, according to a Zillow.com study. In Contra Costa County, an average of 76 percent of the homes bought during those years now suffer from negative equity, the study said.

The good news is that if you can afford your mortgage payments, and you don’t have to move, you can just hang on until prices come back up. And though the landscape is rife with gloom and doom these days, there’s no doubt that in the long run, that will happen in the Bay Area, this best of all possible worlds.

So for some people, the best possible approach is not to worry their pretty little heads about it. Two homeowners interviewed by the Contra Costa Times is taking that approach:

“We’re probably a little upside down now,” said Jeffrey Vandevoir, who owns a Brentwood home that he and his wife, Sara, bought in 2005. Despite the travails, he is determined to pay the mortgage. “We’re going to meet our obligations,” Vandevoir said. “We plan to stick it out.”

Russell LaClair and his wife, Janet, bought their Livermore home for about $600,000 in 2005, according to Alameda County records. An estimate from Zillow.com suggests homes in the vicinity of the LaClair residence are now worth $522,000.

“I know that our house is not worth what we paid when we bought it,” LaClair said about his home. He added, “It is what it is. We made a choice that has left us with a high payment.”

Of course, where the real pain comes in is if you got an adjustable mortgage and soon will be facing payments (or are already confronted with them) that you can’t afford, or if, God forbid, for some reason you should have to move. If it’s for a new job with higher pay, sucking up the loss hurts a lot less. In other cases, not so much.

Readers, are any of you underwater, hanging tight and waiting for the storm to pass? Anyone finding themselves in a position of having to sell and hating it? How long before these homes at least catch up to their mortgages? (Underwater photo: wili_hybrid)