Is the Market Shifting? A Real-Time Look at Whatcom County Housing Trends
As always, the most common question I hear day to day lately -- and mind you, it's always asked with a very curious (and often concerned) tone and mindset -- is, "How's the market?"
Let's pull back the curtain on some of the key metrics and take a quick peak as we transition from spring to summer in this next month or so.
"Has the Bellingham real estate market cooled off?"
There are multiple powerful dynamics at work in greater Bellingham and Whatcom County, and they all tug and pull at the overall market strength / activity / pricing / movement.
I've said many times over the years that the number one determining factor in market strength and activity is "buyer sentiment."
Buyers are always the most nimble, fastest to act group when they smell change or uncertainty.
The current political climate (or $#*&-storm)... the stock market roller-coaster... our Canadian friends staying home...
These things create a collective pause-effect that ripples through all of spending, real estate included.
We see that pause reflected in metrics like average time on market, number of properties dropping their price before selling, actual number of sales, and of course, price across all sales.
Let's peek at some of those numbers and let the data do the talking...
Average Days on Market
This graph below shows the past 5 years, a rolling 6-month average.
The peaks -- the longest averages, about 20 days -- occurring in March of the previous 3 years.
The troughs, showing an average of about 12 to 14 days on market, occur in late August and September.
We are creeping up to an average not seen in the past 5 years, though still a very short overall time frame.
Absorption Rate
Absorption Rate means if no new homes came on the market, how long would the existing inventory last before hitting zero?
Less than 6 months is considered a "Seller's market."
We peaked at 3.2 months in November and December, 2024.
As of March of this year, we're at 2.5 months and dropping.
Translation: Still solidly in Seller's market territory.
I got a lot of replies to the previous newsletter, sharing great hope that an owner-occupant -- even a first-time buyer -- would be the winning bidder.
I totally agree with that sentiment, as it has become nearly impossible for a growing number of would-be homeowners, even couples with dual incomes, to land -- and afford -- a house in Bellingham.
Below is a graph of Bellingham prices over the past 5 years.
The dip near the right was the more-than-doubling of interest rates to over 7% that led to the lowest number of sales the US has seen since 1995.
(That's also what led to the closure of BNP Realtors, incidentally.)
But Bellingham wouldn't linger in that dipped state for long.
On the far right, the line is essentially at the highest point in MLS and market history.
Average Price
Next up, let's look at what average prices have done.
Same 5-year span, rolling 6-month average.
Whatcom-County wide, prices of homes peaked in August 2024 at an average of $715,000.
We have since softened to $675K as we enter the busy summer months.
Number of Closed Sales
Lastly, let's review the actual number of closed sales, or how much real estate is actually changing hands.
Remember during the crazy Covid days when there was "nothing on the market?"
The volume then was actually quite high, it's just that everything was selling so quickly the optics portrayed "nothing to buy."
In reality, we're now coming into what looks like it may be the lowest sales volume since... let me go back and check...
...April, 2012.
Hmm.
All... so... interesting.
The metric I like to follow week to week is the pending percentage, or how much of the avaialble inventory (County-wide) is under contract with buyers right now?
Currently we're at 33% -- 1 of every 3 listings in under contract with a buyer.
Last year at this time we were at 46%, so... a softening, but not at all a halt.
My year-to-date sales
Speaking as only one of 1288 currently licensed brokers in Whatcom County, I've had a solid start to the year.
To date, I've helped 15 clients sell or buy property which, for me, is probably the busiest first quarter of my career -- again, operating as a solo agent.
I've had the honor of helping four different estate Executors navigate their probate sales -- plus one we're remodeling to list soon in the Cordata area.
I've gotten to help several families up-size from starter homes to "this could be our forever home."
And I've had a most educational wave of introducing and marketing Bellingham's near-future multiple-units-on-one-lot zoning changes that are becoming more and more a part of the conversation here.
Real estate remains such an interesting endeavor as no two days are alike, no two buyers or sellers have the same situation or same story, and somehow I continue to be blessed with what I consider the best clients (and most supportive family) a guy could ever hope for.
Remember the "20-year-old who bought a house?"
If you were a reader back in early 2022, you might remember the story of the young man in Michigan that I sold my dad's house to, with seller financing.
He had been living with his parents, paying rent which they gave back to him to use as a down payment...
Does that ring a bell?
Recall, I'd given him a 3-year "balloon" to get his ducks in a row and payk off that loan balance, taking me out of the picture and riding his "real estate equity escalator" off into the sunset.
Well... that story had more in store than I'd anticipated.
The 3-year mark his on February 1, 2025.
When we meet here again, I'll share the story, the timeline, and the outcome of what ultimately happened.
It's.... a doozy. And it should elicit a LOT of discussion.
Til then... I wish you the best, I invite your thoughts, and I extend my sincere gratitude for spending this time with me once again.
