Last month I compared our market to ping pong balls, sometimes up, sometimes down, sometimes both…just depends on the area. In October
Bellingham unit sales up from October 2010 (to 75 homes from 65) & almost equal to last month (to 75 homes from 77).
Ferndale unit sales down from October 2010 (to 14 homes from 27) & down further from last month (to14 homes from 37).
Birch Bay/Blaine unit sales down a bit from October 2010 (to 13 homes from 15) & down a lot from last month (to13 homes from 28).
Ferndale unit sales dropped substantially from October 2010 (to 14 homes from 27) & from last month as well (to 14 homes from 37).
Lynden managed to about break even – up 3 homes from 2010 and down 3 from September.
But how about the prices, you say. They were bouncing too, with average sale prices in Bellingham and Birch Bay/Lynden down in the double digits from September while Ferndale, Sudden Valley and Nooksack Valley saw double digit increases. If we compare to October 2010, Ferndale and Mt Baker home sale averages were up by double digits, while Birch Bay/Blaine and Lynden were down by those amounts and Bellingham and Sudden Valley were close to holding their own. Want more specifics?
Bellingham prices October 2011 to 2010: average -3.7%; median -12.1%
Whatcom County prices October 2011 to 2010: average -15.8%; median -18.8%
Bellingham prices October to September 2011: average -12%; median -2.4%
Whatcom County prices October to September 2011: average +.4%; median -1.9%
The Bellingham market moved even more strongly into the lower price points, with 64% of the sales below $300,000. Obviously, as prices have dropped, more homes have moved into this category, but it is interesting to note that 4 of the past 6 months have had over 60% of sales at or below $300,000. This is atypical, even as far back as 2006. It certainly isn’t because it is now easier for buyers in the lower price ranges to get loans! During the frenzy, this part of the market was heavily dependent on sub-prime loans. Now, standards for even FHA loans are higher.
There are several speculative explanations for the shift:
Prices for homes at all price points have fallen, moving more of the inventory below $300,000.
As prices have fallen, fewer owners of lower priced homes have been able to sell and take sufficient equity out of their current home to move into the next bracket.
As prices have fallen in areas traditionally providing our incoming purchasers (California, Seattle), our market has localized so our buyers have local incomes and less equity.
Buyers (and lenders) are more aware of the hazards of “over-buying”, so they are purchasing more conservative homes.
The table below shows the change in market distribution from last October
October 2010 Price Ranges in $1000′s
Total 2010 October $ Sales
Total Units Sold
Average Sales Price
% of Market
Changes in October Year to Year Distribution of Residential Sales in Bellingham
<300
$7,380,000
34
$217,059
50.7%
300 to <500
$8,739,727
24
$364,155
35.8%
>500
$3,508,000
6
$584,667
9.0%
>750
$2,731,000
3
$910,333
4.5%
October 2011 Price Ranges in $1000′s
Total 2011 October $ Sales
Total Units Sold
Average Sales Price
% of Market
Unit Change
Average Price Change
<300
$10,575,540
48
$220,324
64.0%
41.2%
1.5%
300 to <500
$7,895,576
20
$394,779
26.7%
-16.7%
8.4%
>500
$2,828,005
5
$565,601
6.7%
-16.7%
-3.3%
>750
$2,805,000
2
$1,402,500
2.7%
-33.3%
54.1%
To read the complete article visit The Johnson Team Real Estate’s Real Estate Update Page. www.JohnsonTeamRealEstate.com also includes a constantly updated list of newly listed properties and a list of properties being offered as short sales & foreclosures (REOs), as well as the entire listing database of the Northwest Multiple Listing Service, fully searchable to your specifications.
After a rather scary July in the Whatcom County housing market, August brought a number of pleasant surprises:
More homes sold in Bellingham & Whatcom County as a whole than in any other month this year. This is the first time in 6 years that has happened in Bellingham and only the second for the entire County. June and July typically see the highest number of sales.
August sales matched 2010 sales in Bellingham and were up almost 21% for the County as a whole.
Lynden sales were incredible…up 183% over last year and higher than any year of the past 6.
Ferndale sales weren’t too bad either, doubling from last year and the highest since 2007.
And then there was the pricing story:
Average sale prices in Bellingham dropped 5.8% from 2010 and 9.2% from July of this year.
Average sale prices in all of Whatcom County dropped 6.1% from 2010 and 2.2% from July of this year.
Lynden prices held the best, with the average actually increasing 3.8%.
Sudden Valley was hit the hardest, with both median & average prices down by 35% or more.
So what the heck is going on? Let’s start by going back to the sales distribution numbers for Bellingham. Note the 61.4% of sales <$300,000. Last year it was 50.6%, in 2009 it was 42.4%.
August 2010 Price Ranges in $1000′s
Total 2010 August $ Sales
Total Units Sold
Average Sales Price
% of Market
Changes in August Year to Year Distribution of Residential Sales in Bellingham
Every week we track the number of homes on the market that have offers on them and those that do not and create a ratio we call Pending Ratios. This weeks numbers were great with all areas either remaining stable or up in pendings.
As of Saturday, August 13th, the pending ratio in Bellingham was 20% . Pending is the time frame between when an offer has been mutual accepted between the buyer’s and the seller’s of the home and when the title actually transfers hands. This give the buyer’s time to get the financing, do inspection, review the title reports and more.
To view a complete history of Whatcom County Pending Ratios or for other real estate statistics don’t hesitate to contact The Johnson Team at (360) 303-2734 or by email at Info@JohnsonTeamRealEstate.com
After the first half saw sales and prices stabilize, and in some cases actually rise a bit over 2010, July was a mixed story. The number of homes sold in Bellingham was down 19% and Ferndale was down 30%. On the other hand, every other area except Nooksack Valley was up substantially, from 47% in Birch Bay/Blaine and 67% in Sudden Valley to 100% in Lynden. Average and median prices, on the other hand, were down everywhere but Sudden Valley, where the average was up by 38% and the median by 33%.
From June to July, sales were down almost across the board. Lynden was up by 1 sale and the Mt. Baker area doubled, but all other areas dropped, with Whatcom County as a whole down 15% in unit sales from June. Prices were down across the board, except for the median in Bellingham, which actually increased 13.5% (more about that later)! Whatcom County as a whole posted declines in the average prices of 7% and in the median of 2%.
So in Bellingham, how can unit sales fall, average prices fall and median prices rise by 13.5%? The table below explains. If there are 11 sales, the median is the price of the 6th sale…half are above it and half are below it. As you can see in the table, the biggest unit drop was in the lowest price range, so the median moved up. Relatively speaking, the upper price ranges (particularly from $300,000 to $500,000) lost fewer sales.
July 2010 Price Ranges in $1000s
Total Sales Volume
Total Units Sold
Average Sales Price
% of Market
Changes in July Year to Year Distribution of Residential Sales in Bellingham
<300
$9,341,050
38
$245,817
52.1%
300 to <500
$8,375,250
22
$380,693
30.1%
>500
$6,261,500
10
$626,150
13.7%
>750
$3,299,900
3
$1,099,967
4.1%
July 2011 Price Ranges in $1000s
Total Sales Volume
Total Units Sold
Average Sales Price
% of Market
Unit Change
Average Price Change
<300
$7,190,500
31
$231,952
52.5%
-18.4%
-5.6%
300 to <500
$7,918,500
20
$395,925
33.9%
-9.1%
4.0%
>500
$3,422,600
6
$570,433
10.2%
-40.0%
-8.9%
>750
$2,130,000
2
$1,065,000
3.4%
-33.3%
-3.2%
So why are July numbers so much softer than June? It could be concern over the debt crisis outcome that was recently “settled”. If that is the case, the malaise could hold on for a while since the settlement left many questions unanswered and also pointed up how difficult it is for the federal governing bodies to reach agreement. That does not bode well for resolution of future issues. It could simply reflect uncertainty on the part of borrowers who are following the national economic and employment figures.
Leading indicators of inventory levels and pending sales are still good…inventory is lower than in just 1 of the past 5 years. Pending sales are up 11% over last year, although I do have a concern with the validity of that number. Consistently, short sales have been running 25% to 30% of pending sales…but in July they were only 3.6% of closed sales. In short, they constitute a bulge in the pending sales which tends to just sit there, rather than roll through.
The end of the first half is always an interesting time to look at the sales numbers. We are midway through 2011…what has it brought us, and what may that indicate for our future? As is usual, some areas are up and some are down, but overall we are doing pretty good. The number of sales in the first half of the year were down across the board from last year, but last year we had the homebuyer tax credits during the first half. Average and median prices, on the other hand, were close to last year or up a bit, except in the Sudden Valley and Mt Baker areas, where they have continued to slide. Numbers from Bellingham and the entire county for the past three years are shown in the table below.
YTD
6/30/2009
% Change
Yr to Yr
YTD
6/30/2010
% Change
Yr to Yr
YTD
6/30/2011
% Change
Yr to Yr
Bellingham
Units Sold
393
-16.2%
385
-2.0%
372
-3.4%
Avg List
$340,815
-9.7%
$332,548
-2.4%
$334,131
0.5%
Avg Sold
$326,740
-11.0%
$320,778
-1.8%
$319,178
-0.5%
Median Sold
$290,627
-5.6%
$269,000
-7.4%
$270,000
0.4%
CDOM
132
-1.5%
99
-25.0%
124
25.3%
% of List
96%
96%
96%
Total Whatcom County
Units Sold
837
-18.2%
969
15.8%
823
-15.1%
Avg List
$303,605
-8.7%
$289,109
-4.8%
$290,744
0.6%
Avg Sold
$290,737
-9.9%
$278,515
-4.2%
$277,537
-0.4%
Median Sold
$265,000
-5.4%
$245,000
-7.5%
$250,000
2.0%
CDOM
150
4.2%
123
-18.05
157
27.6%
% of List
96%
96%
95%
A comparison of June 2010 to June of this year is even better, with number of sales even closer to last year – in fact, by the time late reports have straggled in, most areas could match or beat last years numbers.
Distressed property (short sale and bank owned) numbers have stayed pretty consistent over the past year. At the end of June, 10.6% of the Bellingham homes for sale were distressed. 38.6% of the pending sales were distressed, and 16.2% of the sales closed in June were distressed. They don’t seem to be having a big impact on overall sale prices.
Inventory levels in Bellingham are down 12% from last year at this time and pending sales are up by 2%.
Frankly, it looks as though the market is pretty stable. Unless there is some major change in the national economic picture, it seems that it might stay that way for a while.
Some things I am noticing:
Appraisals are more of a problem…either with appraisers not coming up with the value or with underwriters not accepting the appraised value without more comparables. In a market like Whatcom County, where we have multiple small, unique markets, there aren’t always a lot of comparable sales, and that can be a real problem.
There are more multiple offers…sometimes on distressed properties, but often on ordinary sales of desirable homes at good value. As was true in the hot market, not all of these offers last very long….as a seller, it makes sense to look hard at the buyer’s ability and reason for buying before choosing the offer to accept. Some buyers jump in too quickly in the heat of moment, then get cold feet and back away when they have time to think.
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