housing market real estate marketAfter years of drowning with underwater mortgages, American homeowners are starting to swim toward the shallow end as the housing market recovers. Rising home values and increased home equity are spelling relief for many people.

Here are four signs that the housing market is recovering:

1. Unemployment is falling.

In order to have a strong real estate market, you need a strong job market. The unemployment rate fell to 7.7 percent in February, its lowest level since December 2008. February saw 236,000 jobs added to the U.S. economy, which is more than was expected.

2. Home equity is increasing.

Almost two million homeowners moved into a positive home equity last year, according to a recent report from real estate website Zillow.com.

While 15.7 million people had underwater mortgages at the end of 2011, meaning that they owed more on their mortgage than their home was worth, that number dropped by 12 percent to 13.8 million people at the end of last year. Zillow forecasts another 7 percent of homeowners will also have positive home equity by the end of 2013, mostly due to increasing home values.

3. Home values are rising.

Home prices across the country climbed 9.7 percent in January from a year ago, the largest increase since April 2006 and the 11th straight month home prices have risen nationally, according to a new home price index report from CoreLogic. The report showed that all states, except for Delaware and Illinois, saw year-over-year price gains.

4. Home equity lines of credit are rising.

Home equity lines of credit (HELOC) are also on the rise, with a 19 percent increase in originations at the end of 2012. However, this is considerably lower than the pre-recession peak in 2006, according to an Equifax report.

HELOCs can still be difficult to get, and lenders tightened their borrowing requirements after the financial crisis and housing market collapse when they lost billions of dollars worth of loans. While lending has increased, lenders are staying conservative. The average home equity line in October 2006 was more than $100,000. It was slightly below $90,000 in October 2012.

Lenders are giving loans to the people with the highest credit scores, so if you can’t get a loan right now, you might want to spend time improving your creditworthiness. People with lower credit scores might receive higher interest rates or not be able to take out a loan at all.

To see if the housing market is recovering in your neighborhood as spring comes into bloom, watch for more pending home sales and more homes increasing in value.

Ilyce R. Glink is the author of several books, including 100 Questions Every First-Time Home Buyer Should Ask and Buy, Close, Move In!. She blogs about money and real estate at ThinkGlink.com and at the Home Equity blog for CBS MoneyWatch.