2020 in Review

Well folks, 2020 is now behind us, and we’re looking back at what happened across the whole year in our county, with quick stats on key communities and commentary on some of the other interesting trends and events (especially circa March) of last year. 

The Cohen Group NW started producing weekly Whatcom County housing market videos in June of 2020; the project grew out of our team observing a lot of fear around the uncertainty we all felt and faced last year. While anxiety and stress affect us just as much as the next person, we’ve found that focusing on data - actual numbers and trends - has truly helped us understand what we can and guide our clients based on fact.

Across Whatcom County, the state shutdown in March dampened some key factors: new listings on the market, and the number of closings (it makes sense - if the houses aren’t going on the market, they can’t sell!)

With the severe dip in new listings right at the beginning of the typically-hot selling season, the market was compressed and had to catch up later in the summer. But the new listings that went on the market in the summer, while numerous, didn’t resupply the amount of inventory needed for our local market.

(this market update episode compares the spring seasons of 2019 and 2020)

When a market is tight, prices increase (see this episode on factors that affect pricing). A strong listing (like a 3-bedroom updated home in a core Bellingham neighborhood) goes on the market and within a few days there are multiple offers, all of them over asking price. Stories fly around our industry of the home that went for $60,000 over list price after a bidding war. 

Our team experienced it first hand - multiple times - in 2020. Sometimes we were on the side of the buyer that won out over a handful of competitors, or the buyer who lost multiple scenarios before finally winning. Sometimes we represented the seller and fielded dozens of showings and navigated the multiple offer situation.

As the largest (and most expensive) town in the county, Bellingham’s housing numbers influence what happens across Whatcom County real estate.  

Nationally, work-from-home flexibility becoming the company policy of corporations large and small (this video goes into details - start at 2:00) is allowing office and digital-based workers the freedom to live almost anywhere. These individuals are leaving high-priced metros for smaller, developed areas with access to medicine, the outdoors, entertainment, and more. Bellingham, situated between Seattle/Everett and Vancouver (at least when the border’s open), and complete with natural beauty and outdoor sports, a prime medical center and interstate ease-of-travel by road or air, is one of those perfect spots.

Anecdotally, several of our industry colleagues, and agents on our team, have sold plenty of houses in Bellingham to out-of-state migrants. Leo and Layla each sold a house buyer-sight-unseen this year, and for a while Tiffany seemed to have a hobby of showing houses to buyers working with Seattle agents (okay, it was just a couple of Saturdays).

When local buyers, with a 5% or 10% down payment, can’t compete with an all-cash or $100,000-down competitor. When bidding wars end up with a price well above asking, the risk of a low appraisal confirms that as always: cash is king. 

Inventory remains low. We’ve been in a seller’s market since roughly 2014 (depending on the specific niche market), and we don’t see indications of that changing anytime soon. (This video covers 7 economic indicators of a market shift - and answers the “what about the recession?” question).

So buyers that originally hoped to buy in Bellingham look elsewhere. New development in Lynden and Blaine become more attractive, and Ferndale’s easy I-5 access to Bellingham places it firmly as a second choice to the county seat. 

2020’s appreciation was very high in Ferndale. (Bellingham already had its growth spurt: in 2018. After multiple years of annual appreciation in the 8-9.9% range, 2018 Bellingham saw a burst of appreciation, at 13%.) 

Bellingham’s appreciation rate was hardly anything to sneeze at, but it’s Ferndale that wins the Most Improved Award this year.

In smaller municipalities like Ferndale and Lynden, it’s important to remember that the data, while accurate, can skew for years that have a high number of sales in a specific niche market, for whatever invisible reason. When 300 homes sell in a year, a 50-unit new construction development has significant impact and can affect the median price points for the area. 

The general market data is not what someone should base the pricing expectation for their personal home when they're thinking of selling. It’s critical to have a comparative market analysis prepared by a professional, which takes into account a multitude of factors to price a home founded on a narrow set of specific facts.

In conclusion, 2020 was another wild ride for the Whatcom County real estate market. With a severe constriction of new listing inventory for key sales months, the rest of the summer (and extended into the fall) was a flurry of sales activity, resulting in a schmozzle of multiple-offer situations, overbooked vendors, and negotiating low appraisals on houses that were bid up too high. Thousands of families found a new home this year - celebrating a new addition, changing jobs, or moving into a new region and lifestyle.  

2021 is off to a strong start. And week by week, our team will be here to report what’s going on in the Whatcom County housing market.

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