Not even the lowest interest rates in decades could entice wary house-hunters last month. Homes sales in Whatcom County remain sluggish with pending sales about even from the same time last year but not all numbers were down.

Year to date closed residential sales increased 13%. Including condominiums closed sales were up nearly 17% year to date. Brokers applauded congressional approval of legislation to extend the tax credit deadline on contracts signed by the April 30 deadline. The deadline has been pushed out to September 30, 2010.

In general consumers seem to be stuck in uncertainty surrounding the world’s economic concerns, our lack of jobs and the rollercoaster of the stock market. They seem to be hunkering down despite the lowest interest rates in years.

Buyers were quite shy, as pending sales posted a 20.5% decrease to 205 from June of 2009. Many would-be June buyers already bought during the credit period. Sellers seemed to be more confident, so new listings increased 14.6% to 360 over last June.

In response, inventory levels increased 7% to 2,177 over last year, which predictably exerted downward pressure on prices. The June median sales price of $246,500 was a 7.9% decrease from last year.

Negotiations inched slightly back toward the seller by 0.5% to arrive at 92.9% of their original list price. Market time decreased 11.5% to 109 days; whilc months of supply decreased 9.0% to 12.4 months.

Brokers reported activity at levels we haven’t seen in a while.  Notably, while entry-level home sales have been driving the market, brokers also reported strong activity at the upper end of the price spectrum.

For the first quarter of 2010 Whatcom County also experienced a rise in inventory levels as well as a positive increase in pending and closed sales. However, the median price continued to drop due to the shift of buyers to the more affordable priced homes.  For the quarter prices were down about 8% throughout Whatcom County.

Pending sales of used residential homes were the strongest in Lynden (up 50%) and Blaine/Birch Bay (up 39%). Overall the county was up 13% from the first quarter of 2009. Closed used single family sales were up 27% in the first quarter of 2010 over the the same period in 2009. Ferndale, Blaine/Birch Bay and Lynden respectively increased the most. 68%, 32% and 25% respectively.

Median prices were down 13% in Bellingham, down 3.5% in Ferndale, up 6.5% in Blaine/Birch Bay, down 4.5% in Lynden and down 10% in Sudden Valley.

The surge, in sales, in Whatcom County is thanks to the opportunities that have been afforded to homeowners through the federal tax credit, low interest rates and increased affordability. We have seen a dramatic shift of median prices since 2007. In the first quarter of 2007 58% of the sales were under $300,000 in Whatcom County. In the first quarter of 2010 the percentage was 75. Ferndale had the largest increase from 48% in 2007 to 78% in 2010.

“More certainty” and “more stability” in the market contributed to a boost in activity during January, according to officials from Northwest Multiple Listing Service. Brokers reported an increase of nearly 27 percent in pending sales from December and a 28 percent jump from twelve months ago.

Two other indicators of activity fell – inventory and sales prices. There were 3,915 fewer active listings of single family homes and condominiums in the entire MLS system compared to a year ago, a drop of about 10 percent. Sales prices area-wide for January closed sales declined about 4.8 percent from figures a year-ago ( the NWMLS service area covers 21 counties).

For Whatcom County, in January, pending sales of residential homes were down 7 percent while closings were up 5.5 percent. Our listing inventory of residential homes was up 26 percent compared to January, 2009. Prices were down about 3 percent for the entire county.

Currently, there is about 13.5 months of inventory ( ratio of houses for sale to houses sold). January, 2009 was 14.6 months of supply. Economists consider a supply of six months to be a balanced market. One month can be deceiving but due to the increase in listings and reduced closing the supply number is somewhat skewed. A first quarter analysis will be telling. The absorption rate was 7.4 percent as compared to 6.8 percent from January, 2009. The absorption rate analyzes how many homes have sold of the existing inventory in a month.

Nearly 80 percent of the residential sales were under $350,000 which is about the same compared to the same time last year.

In its annual statistical summary,  the Whatcom County real estate market reported 3,775 sales for a total value of $995,134,398. There were 2229  residential sales totaling $668,812,479, plus 414 condominium sales totaling $78,500,000.

 2009 sales ( units) continued their downward trend. All sales throughout Whatcom County were down about 10%.

 The residential resale market was the only category up by 1%. New construction sales decreased by 33%, condominiums were down 26% and land sales down 18%. These are unit sales.

 The median price declined about 6.5%( $258,000) for a residential resale home in Whatcom County. New construction prices were down about 12% ($263,000) and the median price of a condominium was unchanged at $191,000.

 Among other highlights in the annual CBMA summary:

 1.     Residential and Condominium listings decreased 8%.

2.     The highest residential sale was $2,500,000 in Point Roberts.

3.     The highest condominium sale was $740,000 in Bellingham.

4.     There were a total of 17 residential sales above $1,000,000.

5.     Nearly 75% of all residential sales were below $350,000.

 Residential sales:  Units compared to 2008

 Bellingham down 9%, median price $289,000

Ferndale down 10%, median price $260,000.

Blaine/Birch Bay up 1%, $224,000.

Sudden Valley down 3%, $231,500.

Lynden down 1%, $269,000.

Mt Baker/Deming down 14%, $135,000.

Everson/Nooksack up 17%, $215,000

Home sales continued to out-perform year-ago totals and prices continued to show signs of stabilizing, according to the latest report from the Northwest Multiple Listing Service.

Pending & Closed Sales Up Over 2008, Median Price Drops

Pending sales for November tapered off from the October surge, but Whatcom County experienced a 25 percent increase from the same period in 2008.

Closed residential sales increased dramatically from November, 2008. Closed sales were up 88 percent, due in part by lower interest rates and first time homebuyer tax credit. The other reason for such a dramatic increase is the tremendous slowdown that occurred last year at this time.

The median sales price is down about 7.6% in November (over November 2008), and down 7.1% year to date.

Inventory Almost at Balanced Market Levels

Overall residential inventory has decreased by 9% year-to-date. November, 2009 vs. November, 2008 numbers are even. For the month of November, months of inventory was at 7.5 months, as compared to November, 2008 when it was 16.5 months. Six months of inventory is considered a balanced market.

Average cumulative days on the market for November, 2009 is 157 days, which compares to only 126 days on the market in November, 2008. The list to sale ratio is at 89% for November, 2009, compared to 91% in November, 2008.

Finally, the absorption rate for residential sales for November was 13.3%. It was 6.1% for the same period in 2008. The absorption rate indicates how many homes are being sold as compared to the number of listings currently on the market. Since November of 2008, that rate has steadily increased.

Holidays can be a favorable time to sell

Buyers tend to encounter less competition for the most desirable homes during these winter months. Also, qualified buyers can expect above-normal attention from service providers who are experiencing a slowdown in their business, including lenders, inspectors, appraisers and title companies.

Agents are able to devote more time to clients and the smaller selection of homes on the market. Sellers can also benefit from showcasing their homes with tasteful holiday decorations, although home stagers caution them to show restraint and not overdo the décor.

I recently had the opportunity to talk with Business Editor Dave Gallagher at the Bellingham Herald about our local home buying season.

To view the complete article, please click here.

Western Washington real estate brokers are crediting the federal tax credit and its impending expiration deadline for a surge in home sales last month. Members of the Northwest Multiple Listing Service reported a 63% jump in pending sales during October, compared to the same month a year ago. The other reason for such a surge of sales was that October, 2008, was the first month after the financial meltdown and sales dropped like a rock.

As of this writing, the homebuyer tax credit has been extended to April 30, 2010. You can read more about this here, in a previous article on our blog.

Pending Sales Up

In Whatcom County, pending sales increased nearly 75% in October compared to the same month a year ago. In Bellingham, pending sales increased 63% for October. Lynden was up 63%, Ferndale increased 105%, and Blaine/Birch Bay increased 67%, while Sudden Valley was up 39%.

The new figures show continued signs of some stability in the market and improving consumer confidence. Inventory levels are down about 10% and Whatcom County added about 313 residential new listings in October: about the same as one year ago.

Median Prices Down

The median price for October was $260,000. And, if you add condominium sales, the median price is $251,000. Overall value decreased 7.1% and 5% respectively.

Majority of Activity Under $350K

For the month of October, 80% of residential sales were under $350,000, versus only 71% a year ago. The upper-end market accounted for about 9% of the sales over $500,000 in October, as opposed to 7.7%  in October, 2008.

Interest Rates Remain Low

The weekly average interest rate borrowers were quoted for 30 – year fixed mortgages at 4.87 percent. Rates for a 15-year fixed mortgage were 4.31 percent.

Delinquencies on single-family homes continued to rise at the two big government-sponsored  mortgage lenders, Fannie Mae and Freddie Mac, indicating that problems have yet to level off.

Existing home sales surged in September, bringing sales to the highest point since 2007. At the same time, the Department of Commerce just reported that sales of new single family homes fell 3.6% in September to an annual pace of 402,000 units.

Sales of both existing and new homes had been on the rise of late, encouraging many an economist that the worst is behind us.  Some will say that the new home sales numbers show that this will be a shakier recovery than in past recessions.

That may be true, but keep in mind that home sales as a whole are up by a pretty large margin. Those sales are helping bring down the inventory of unsold homes, which is so vital to returning to sustainable times.

Analysts had expected new home sales to rise to 440,000 units, most likely based on the final push of first-time buyers looking to take advantage of the $8,000 tax credit.

Buyers looking at new homes will find some homes that are already completed and those that are not finished. First-time buyers, who account for nearly 45% of the buyers at the moment, are looking to eliminate any possible risk of missing out on the credit.  Purchasing a home still under construction without a guarantee of closing before 11/30 will push many would-be new homebuyers to existing homes.

The numbers may already be bearing this out. In September, sales of existing homes jumped 9.4% to an annual rate of 5.57 million. This is the highest rate in more than two years.

Bellingham Herald Business Editor Dave Gallagher recently wrote this article, which points out that Bellingham’s home sales have stabilized for the first time since 2007. As the article mentions, 82 Bellingham homes sold in the month of May; the same number of homes sold in May of last year.

Whatcom County home sales outside of Bellingham have yet to reach this point. Many local areas are still seeing year-over-year deficits in terms of the number of home sales going through.

One of the other local trends that I commented on in this article is that most homes are being sold in the $350,000 and under price range. This tells us that a lot of first-time homebuyers are getting in the mix as of late, and that this segment seems to be driving this local stabilization.