POSTED: Sunday, Nov. 08, 2009

A closer look at the local home-buying season

With the peak of the local home-buying season out of the way, more detailed numbers are showing some insight about what's happening.

Gragg Miller of Coldwell Banker Miller-Arnason recently released a 28-page real estate report, crunching the numbers through the third quarter. Here are some of the stats that jumped out at me:

Inventory supply dropping: In the third quarter, Miller estimated Whatcom County had an eighth-month supply of inventory. That's down from 9.5 months in the second quarter and 14.3 months in the first quarter. A year ago, the inventory supply was at 9.23 months.

Generally, Miller said the balance between buyers' and sellers' market is a six-month supply. While the months of inventory have been steadily falling, Miller doesn't expect it to lead to any new construction anytime soon. He noted there are fewer builders, many banks aren't likely to lend for new residential projects at this point and there are few empty lots in Bellingham to develop.

Bellingham more active than county: In the first three quarters of 2009, overall residential sales are down 27.7 percent compared to the same period in 2008. However, Bellingham is down 22.7 percent, while the rest of Whatcom County is down 31.8 percent year-over-year.

"Bellingham is the strongest market (locally) at this point, especially in the higher-end price range," Miller said. "That is also showing up in the prices, where the price reductions are more significant outside of Bellingham this year than inside the city limits."

High-end home changes. In the first nine months of 2007 there were 35 homes that sold for more than $1 million in Whatcom County, with 20 of them being in Bellingham. In 2009, there were 15 of these type of homes sold in Whatcom County, with 10 being in Bellingham. In 2002, there were two homes in the entire county that sold for more than $1 million. The bubble for this price segment was in 2006 and 2007.

One other trend Miller is seeing is that the activity remains in sales below $350,000. That's where about eight of 10 of the sales were in October. In that price range, Miller estimates the amount of inventory is more in the four-month range.

"Overall, sales started very slow in 2009 and has gotten stronger later in the year," Miller said.