In June, Whatcom County real estate markets showed the effect of accelerated sales due to the homebuyer tax credits. Sales numbers dropped from 10% to 40% in all markets except Birch Bay/Blaine (up 4%) and Lynden (up 40%) over June of 2009. Average sales numbers in the county as a whole were down 25% and were lower than any month since February of this year.
The tax credit benefits showed up in more sales for the total of the first 6 months (except in Bellingham), due to strong sales earlier in the year. Birch Bay/Blaine & Lynden were particularly strong in the 2nd quarter, with sales up 53% in Birch Bay/Blaine and up 75% in Lynden over the same period last year. In June, Lynden numbers were still strong (up 40%), and Birch Bay Blaine was up 4%.
The strong volume in Birch Bay/Blaine and Lynden helped move average sale prices up a bit over the first half of the year (2.6% and 1.7% respectively), and Birch Bay/Blaine managed to move the median up a bit, with an increase in the measurement of 2.1%. The county as a whole saw average sale prices drop by 4% and the median drop by 7%.
As prices drift lower, homes move into different price categories, which shows up in changes to the distribution of sales through price ranges. For the 6 months ending June 2009, 53.4% of the sales in Bellingham were under $300,000. For the 6 months ending June 2010, 62.6 % of the sales in Bellingham were below $300,000. The upper end, above $750,000, maintained the same number of units sold, but the range from $300,000 to $500,000 was particularly hard hit.
Why were Birch Bay/Blaine & Lynden so strong? I think there are two answers: price point and newer inventory. Over the entire 6 month period, Ferndale and Sudden Valley also saw higher numbers of homes sold than last year. All of those areas have more lower priced, newer homes available for sale than does Bellingham, which was down 4.1% in number of homes sold over the past 6 months.
So what lies ahead? Bellingham pending sales as of June 15 were down 32% from 2009, while inventory levels were 16% higher than a year ago. Interest rates are phenomenal. We are starting to see a few more out of town buyers. Ferndale and Sudden Valley, while not increasing sales in June over last year, managed to stay close to last year’s numbers. Increased inventory may solve some of the issues we have had with buyers finding the property they want.
I think there is going to be some further adjustment while the demand that bought earlier is replaced by new buyers in the market. After that, there are factors out there that could help boost the sales numbers again, but buyers are expecting deals and lenders are wary of appraisal values, and both put a damper on increasing prices.
For ongoing real estate numbers, go to www.JohnsonTeamRealEstate.com/blog. We update the site weekly with everything from interest rates to market conditions to information from Fannie Mae, the FED and the FDIC. Also, feel free to call us at (360) 303-2734 or e-mail Info@JohnsonTeamRealEstate.com if you want to know more about a specific portion of the market – we track a lot more than we have space to report.