By Mike Kent
As we head into each New Year, there are plenty of broad real estate statistics published on the national, state and regional level. What most of us are curious about though are the trends developing in our own backyard – the important local numbers that drive the price of your real estate up or down. Using data from the Multiple Listing Service, here’s how the Blaine/Birch Bay market is trending.
Whatcom County residential (home and condo) prices rose 8.4 percent in 2014, while the
Blaine/Birch Bay market rose 6.6 percent. This was affected to some extent by the drop in Canadian buyers in Birch Bay, as the loonie trended downward.
The average sale price for Blaine/Birch Bay was $274,228 in 2014, up from $257,228 in 2013. We’ll continue to see the market and prices strengthen as inventories continue shrinking. In January 2014 we had a 10-month supply totaling 220 active listings. Currently, we have an eight-month supply of 180 properties. It is still a buyer’s market to a small degree, but as inventories get to only a five or six-month supply, as Bellingham has already done, we will finally be back to a balanced, sustainable market.
It’s interesting to see how our local real estate has changed since the market’s historical high point in 2005, when 502 residential units sold, compared to the 340 sold in 2014. We sold one-third more homes and condos back in 2005 because mortgage money was very easy for Americans to obtain, and the loonie was headed upward. Additionally, there was a tremendous influx of buyers from out of the area, particularly California, which kept spec builders cranking out product as fast as they could. In 2007, the market nosedived, striking bottom in 2011, when only 276 units were sold. Ever since, we’ve been on a slow but consistent climb back, initially only in volume but now in price as well.
Because relatively few spec homes exist, we are poised for a potential shortage as early as the second quarter. A number of buyers from out of area are choosing Blaine/Birch Bay, and mortgage interest rates are expected to stay well below 4 percent.
Whatcom County is having a rental property shortage, which has reached near crisis levels in Bellingham with a vacancy rate under 1 percent, forcing more tenants to look to our area and absorb inventory for rentals that may have otherwise been available for sale. Many renters are realizing owning may now be cheaper than renting.
More local jobs have been created with the reopening of the Semiahmoo Resort, and gradually new commercial life is coming to downtown Blaine and Birch Bay. The Whatcom County planning department reports a significant increase in project applications, particularly for Birch Bay.
2015 looks very bright for the local real estate market, and we have the potential to get back to the previous activity levels of 2005. This time we’ll get there with stronger bank loans and thinner inventory, making for healthy and sustainable increases in values. We’ll still benefit from the Canadian buyer but be less dependent on their impact, as proven in 2014 when sales went up despite the loonie going down. If you bought between 2005 and 2008 and find yourself upside down in your home’s value, stay put, as help is on the way. If you bought at the bottom in 2011, your investment is looking even better.