What are the signs of a healthy real estate market?

One of the best signs of a healthy real estate market is number of months of inventory. The number of months of inventory will convey whether a real estate market is a buyer’s market, seller’s market, or balanced market. A balanced real estate market in Bellingham should have 3 to 6 months of inventory. If there is less than 3 months of inventory, then there is a clear seller’s market. In a seller’s market the number of available homes are scarce and there is a high demand for homes. If there is more than 6 months inventory, then it is a buyer’s market. In a buyer’s market there is a lower demand for homes and prices begin to fall.

How many months of inventory are currently on the market in Bellingham?

There is currently 6.7 months of inventory on the market in Bellingham. This suggests that Bellingham is in a buyer’s market. However, if we look at the past 13 months we can see that Bellingham’s real estate market was very balanced until last August. During last August the national credit/lending crisis occurred and nearly every real estate market took a spike in inventory as it became increasingly difficult to obtain financing.

As we can see by the graph, Bellingham’s real estate market did not spiral out of control and never broke over 10 months of inventory. The market has slowly been working back towards a balanced real estate market of market and I expect the July figures to continue the downward trend from the last couple of months.

I follow the real estate trends in Bellingham very closely and would be happy to discuss the market further with anyone who is interested.