Dear Friends,
We hope this letter finds you safe and healthy as you shelter in place. Truly, we are in unprecedented times here in the PNW and we wanted to reach out to our client base in order to update you on the state of our real estate market and what to expect in the coming weeks and months.
Our local real estate market has not been hit nearly as hard as Wall Street. Stocks have been volatile, entire industries are putting themselves on hold, and small businesses are taking hits, but our Whatcom County real estate stats show that there are still willing buyers and sellers amongst us. With that said, real estate showings will be put on hold during the Governor’s mandated lock down and this will surely stifle transactions over the next few weeks.
There is so much we don’t know about what the next few months will bring, including whether the crisis will even be finished. It is safe to say that its economic impact will be felt for some time, affecting everything from employment rates to physical access to homes that are listed. Many buyers in the market will have less money and potentially less access to money. We will be keeping a watchful eye on lenders updating their underwriting policies, which will ultimately impact purchasing power.
Now, if you had aspirations of buying or selling this year, don’t lose heart (just yet). With all the “noise” rattling around on the media and coming through our screens, it may seem silly to be thinking about a home purchase or sale. There will be a large segment of buyers who are not worried about job security or may be moving for new job offers that have not been revoked. Also think of the emerging market for buyers needing to relocate to consolidate, making room for family members, or moving closer to care for older ones.
Optimistic and glass half full, we know. But let's look at the difference between the 2008 crash and what is happening now:
In 2008 The S&P 500 ultimately ended up losing half its value by the time the plunge bottomed out. As the stock market plummeted, so did home prices. That's not what we are seeing (so far) with the COVID-19 pandemic both nationally and regionally (so far). In fact, Whatcom County average home prices have inched incrementally up since schools were closed back on March 12th. Additionally, the current rock bottom interest rates are huge incentive compared to 2008. Purchasing a home now means never having to refinance in the future on top of locking into historically low payments.
The alternative is to hunker down and wait this thing out, and that’s fine too. Everyone has different levels of risk tolerance which is perfectly understandable. Either way, we are going to be sheltering in place but keeping you updated weekly with Whatcom County/Skagit County commercial and residential real estate statistics. You’ll be well informed of market trends, updates in real estate policy, and of course local news that will affect our property values. Until next week, be smart, be safe, and be well.
The Cantrell Group