Market Update July 2023 - Statistic Deep Dive

I was surprised to see an article published on July 6, on KGMI titled "Real Estate Market Continues To Cool in Whatcom County" which basically took one statistic (median home prices in June 2023 compared to 2022) and ran with it.

This is far from an accurate picture of what's happening in our local real estate and market and let me explain why.

Let's first take a slightly broader perspective look at the 26 counties in our Washington State NWMLS.

In June of 2023, brokers with Northwest Multiple Listing Service reported their highest volume of closed sales last month (6,842) since September 2022’s total (7,504).

Additionally, the number of active listings of single-family homes and condominiums systemwide is down nearly 21% from June 2022 (10,607 versus 13,405).

Twelve of the 26 counties had less than two months of inventory and five counties reported having more than four months of supply (Columbia, Ferry, Kittitas, Okanogan, and San Juan). Sales volume dropped in June 2023 compared to June 2022 by a whopping 24!!%

And this is where the unkeen eye may think the market is slumping.

The median price for last month’s 6,842 closed sales was $625,000. That is a drop of 3.85% from a year ago. Ouch!

However, prices are up about 12.2% since January when the median price was $557,250. Seventeen counties of the twenty-six reported double-digit price gains since January.

Now, let's look at what's happening locally here in Whatcom County.

In June of 2023, the median home sales price was 531,750, an 8% drop from where it was in June of 2022, yet it's 5.6% up from the median home price in September of 2022 and 4.1% up from January 2023 and a whole 8.8% increase from the previous month of May 2023.

 

The market is cooling with an 8.8% increase in median sold home price from the previous month? No chance. 

Bellingham followed suit with a median home sales price in June of 2023 of 590,000, an 12.6 % drop from where it was in June of 2022, and crazily it sat at $575,000 in October 2022, November 2022, and January of 2023.

Total New listings in Whatcom County were down 32.7% from June of 2022 and total closed volume for Whatcom County was down 22.2%. Wow! In Bellingham, this trend trailed closely to the County with a 29.3% drop in listings in June 2023 vs June 2022 and a 22.4% drop in total sales volume.

 

If we are to draw any conclusions from this data (and we should be very cautious to do so), it's that;

1) Statistics can be very misleading, particularly if we're just looking at one or two data points

2) New Listings are way down and this is keeping values from falling. This is also why the closed dollar volume is way down.

3) Values are stabilizing to some degree. Even though the market is not the INSANITY it was last year, buyers are looking at the long game and willing to bite on a 7% interest rate today, with the expectation they'll be able to refinance to a more manageable rate in the coming years.

Homes in middle-range price points are still quite competitive with many receiving multiple bids. Homes in the higher points are still selling as affluent buyers care less about interest rates and more about safe harbors to stave off inflation.

Be very cautious when reading news headlines. They don't always paint the full picture.