Bellingham is one of many cities where home values have gone to the stratosphere and left local economy behind

Updated 2017.
There's something wrong with this picture from the standpoint of sustainable economics and basic fairness.

Continued below: 

Looking out over part of town from Samish Hill area.  Bellingham Bay and San Juan Islands are visible from many neighborhoods.

Victorian homes reside in parts of Bellingham, this one is a bed and breakfast on Garden St.

Property values have risen very high in places like the San Francisco Bay area.  People who bought houses, back in the 1970s when one could still do this for around $50,000, have been selling for over 1 million.  Then they have been moving to towns like Bellingham.

Often they're post war boomers who never dreamed they'd become millionaires.  Some are even old hippies, so to speak.  Now teachers, or what ever who sometimes retire early.   Hippies turned yuppies.

It's been an unprecidented bubble that has grown for nearly two decades.  Now it's starting to burst, but Bellingham home prices have remained kind of high and stable compared to the rest of the post 2008 economy.

Why is that the case?

I think many Bellingham homeowners don't even owe a mortgage. 

Across the nation, homebuyers defaulted on mortgages as housing values soared so high that people suddenly realized the jobs don't pay enough to afford house payments.

In Bellingham, it seems like many home owners either bought early, when houses were still affordable and just rode the bubble up.  Quite a few are retired and don't seem to owe that much, unless they got in over their heads with home equity loans. 

People who work in Bellingham are often renters.  Majority of Bellingham residents are renters.

There are some who work in higher paying education and medical sectors.  Also some consultants and the like, but much of our local economy is service sector paying around minimum wage.  Here in Washington State, tho, minimum wage is a whopping $11 per hour.  

Affording the monthly payments on a home worth $350,000 (aprox. median price, I think in city) is not likely on $11 per hour;  especially if one is a recent homebuyer. 

Not even the bottom of the real estate market is affordable with condos starting at over $100,000. 

Rent isn't cheap either, but there are some good niches out there.  Also the city and other non profit agencies are trying to provide affordable housing.  There is a housing shortage for rental housing, but quite a bit of new construction.

Mount Baker Apartments, Bellingham

Downtown Mount Baker Apartments, managed by Catholic Community Services

Comment from a reader

Thanks for your insight on the continuous growth of Bellingham, albeit good and bad.

Please don't forget though that a lot of people are now working out of their homes and "tele-commuting" to work as myself. I still work (contract) for the company in California that I worked for when I lived there, however, I work via the Internet these days. I know quite a few people in Bellingham who do the same thing. This has allowed many people to move where they want to and not have to worry about the commute hassles anymore. And we are contributing to the business and economy of Bellingham even though we don't really work for companies here.

Also, please remember a lot of people made a lot of money in the stock market in the heyday of the mid to late 90s. I feel this gave many people the ability be become upwardly mobile and many of them are set for life (unles their money is still invested in the stock market which is struggling to recover after this God-awful session with George Bush at the helm). 

Just thought I'd add my two cents worth to your commentary. 

Thanks again for your great articles...Loren

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