Home Prices Dip from 2Q Peak, Rising Interest Rates Cut into Sales
October 04, 2022
Steadily rising mortgage rates significantly affected the number of homes sold in Whatcom County during the third quarter and tapped the brakes on price appreciation.
Only 773 Whatcom County homes sold in the third quarter ending Sept. 30, a drop of 19.9% from the third quarter in 2021, according to Troy Muljat, owner and president of Bellingham-based Muljat Group Realtors. Muljat prepared a report based on data from the Northwest Washington Multiple Listing Service.
The median price of homes sold in the county in the third quarter was $599,000, which was 7.7% higher than a year ago but 7.7% lower than this year’s second quarter.
“Much of the housing market’s change can be attributed to rising mortgage rates,” Muljat said. “The average 30-year mortgage rate is now around 6.7% after starting the year at 3.3%, according to Mortgage News Daily. That makes the monthly house payments soar and the number of people who qualify to buy a home shrink.”
“Inventory is continuing to increase, which is bringing the supply closer to a balanced market,” he added. “We’re not there yet, but buyers have more choices. Consequently, we are seeing fewer bidding wars and more offers that are under the listing price. After months of seeing the average house sell for more than its listing price, the sales now are averaging at 99.5% of the listing prices.”
But Muljat doesn’t expect home prices to plunge. “There still are plenty of people wanting to buy a home in Whatcom County and a good share of them don’t need a mortgage to do so.”
Another effect of rising interest rates is that it takes longer to sell a home. The average time on the market for a Whatcom County home in the third quarter was 24 days, up 50% from the second quarter and up 14.3% from a year ago.
The median sales price, average sales price, number of units sold and average days on the market (DOM) before a sale for the county and individual communities for the third quarter of 2022, with percentage comparisons to the third quarter of 2021, follow.
Whatcom County – Median price, $599,000, up 7.7%; average price, $651,892, up 7.8%; units sold, 793, down 19.9%; DOM, 24, up 14.3%.
Bellingham – Median price, $710,000, up 10.1%; average price, $838,404, up 12.0%; units sold, 265, down 13.1%; DOM, 19, up 46.2%.
Birch Bay/Blaine – Median price, $552,500, up 16.0%; average price, $598,974, up 4.9%; units sold, 108, down 15.0%; DOM, 33, up 73.9%.
Ferndale – Median price, $627,500, up 15.3%; average price, $640,577, up 10.2%; units sold, 134, down 18.3%; DOM, 18, up 28.6%.
Lynden – Median price, $626,250, up 8.0%; average price, $672,366, up 9.8%; units sold, 68, down 27.7%; DOM, 24, up 71.4%.
Mount Baker – Median price, $375,000, up 7.0%; average price, $374,785, down 7.3%; units sold, 123, up 7.9%; DOM, 33, down 46.8%.
Nooksack Valley – Median price, $519,500, up 10.2%; average price, $534,599, up 12.4%; units sold, 44, up 4.8%; DOM, 26, 116.7%.
Sudden Valley – Median price, $535,000, up 1.7%; average price, $566,771, up 3.7%; units sold, 51, down 17.7%; DOM, 24, up 166.7%.
Only 773 Whatcom County homes sold in the third quarter ending Sept. 30, a drop of 19.9% from the third quarter in 2021, according to Troy Muljat, owner and president of Bellingham-based Muljat Group Realtors. Muljat prepared a report based on data from the Northwest Washington Multiple Listing Service.
The median price of homes sold in the county in the third quarter was $599,000, which was 7.7% higher than a year ago but 7.7% lower than this year’s second quarter.
“Much of the housing market’s change can be attributed to rising mortgage rates,” Muljat said. “The average 30-year mortgage rate is now around 6.7% after starting the year at 3.3%, according to Mortgage News Daily. That makes the monthly house payments soar and the number of people who qualify to buy a home shrink.”
“Inventory is continuing to increase, which is bringing the supply closer to a balanced market,” he added. “We’re not there yet, but buyers have more choices. Consequently, we are seeing fewer bidding wars and more offers that are under the listing price. After months of seeing the average house sell for more than its listing price, the sales now are averaging at 99.5% of the listing prices.”
But Muljat doesn’t expect home prices to plunge. “There still are plenty of people wanting to buy a home in Whatcom County and a good share of them don’t need a mortgage to do so.”
Another effect of rising interest rates is that it takes longer to sell a home. The average time on the market for a Whatcom County home in the third quarter was 24 days, up 50% from the second quarter and up 14.3% from a year ago.
The median sales price, average sales price, number of units sold and average days on the market (DOM) before a sale for the county and individual communities for the third quarter of 2022, with percentage comparisons to the third quarter of 2021, follow.
Whatcom County – Median price, $599,000, up 7.7%; average price, $651,892, up 7.8%; units sold, 793, down 19.9%; DOM, 24, up 14.3%.
Bellingham – Median price, $710,000, up 10.1%; average price, $838,404, up 12.0%; units sold, 265, down 13.1%; DOM, 19, up 46.2%.
Birch Bay/Blaine – Median price, $552,500, up 16.0%; average price, $598,974, up 4.9%; units sold, 108, down 15.0%; DOM, 33, up 73.9%.
Ferndale – Median price, $627,500, up 15.3%; average price, $640,577, up 10.2%; units sold, 134, down 18.3%; DOM, 18, up 28.6%.
Lynden – Median price, $626,250, up 8.0%; average price, $672,366, up 9.8%; units sold, 68, down 27.7%; DOM, 24, up 71.4%.
Mount Baker – Median price, $375,000, up 7.0%; average price, $374,785, down 7.3%; units sold, 123, up 7.9%; DOM, 33, down 46.8%.
Nooksack Valley – Median price, $519,500, up 10.2%; average price, $534,599, up 12.4%; units sold, 44, up 4.8%; DOM, 26, 116.7%.
Sudden Valley – Median price, $535,000, up 1.7%; average price, $566,771, up 3.7%; units sold, 51, down 17.7%; DOM, 24, up 166.7%.
