How is the Bellingham WA market?

Question

Good afternoon everyone! I was hoping to get some information about Bellingham WA and whether or not now is a good time to buy or rent. I will be moving to Bellingham on May 1st for work and my family and I will remain there for a 3-4 year period. I guess my question is, should I look to buy right now or wait til the market gets better and just rent a place in the meantime? It seems like inventory is limited and deals are non-existent. Ideally I would like to purchase a duplex for my family to live in and then rent out the other but I haven't seen anything where numbers make sense. I'll comb through the usual online sources daily (Zillow, Redfin, etc) to get an idea on the area but I hope someone who lives there can give me the current pulse of the market. Sorry for the novice post! Still getting the hang of BP forums :) Thank you for your time!

Mary Kay Robinson · Answer

I know several loan officers who do VA loans - talk with Leena at Caliber Home Loans, Tom Mathewson at Bank of the Pacific, Carmen at Umpqua Bank, Tammie at Banner Bank.  Lots of good loan officers to talk with.

Mary Kay Robinson · Answer

Inventory is low and all signs point to that not improving much in the future.  I just came from a presentation on the economic forecast for Bellingham/Whatcom County and the housing market.  Price appreciation will slow from what it has been in the last couple of years but interest rates will probably rise to around 4.6% by year's end.  That affects your purchasing power.  I guess my question is, when you are done with your time in Bellingham, is your intention to hang onto the property and keep as an investment or sell for a profit?  If you are thinking of selling for a profit, the margin of profit over sales price may not be enough to offset all the closing costs (think 8.5% to 9%).  If you are thinking of holding long term, I say go for it.  We still have strong in-migration, a popular university which keeps demand for housing high and stories of people who are telecommuting to the Seattle area for work as housing is much less expensive in Bellingham than Seattle.

Chauvin Rupley · Answer

Account Closed brought up a good point about 4 years of rent adding up and leading to nowhere. In a perfect world (circa 2009-2010) I'm sure this conversation would have gone a lot differently. Instead of asking how the market is I would be asking who's a great loan officer who specializes in VA loans ;)

Account Closed · Answer

@Chauvin Rupley Bellingham rocks!!! You may end up staying longer than you plan.....WWU alumni here.

All of Whatcom county is pretty great in my opinion. You have great access to outdoor activities as well as amenities of a larger city including great dining and entertainment options without all the crowds or traffic that exist down here in the Snohomish/Pierce/King county area.

Patrick Britton · Answer

@Shawn Tompke unfortunately none of the widely held beliefs like the 1% rule and such, don't apply very well to Bellingham, or most of Western WA for that matter.   :(

@Chauvin Rupley  I think your question is best answered by looking at your long-term real estate investing goals.  After all, if you were to purchase a duplex here (every now and then there's a good one) and move back in a few years you could always keep and rent it, and hopefully enjoy some capital appreciation.  If the market is good, maybe selling and taking the profits is better?  Good to have more than one exit strategy IMHO.

But if your long term goal is not in line with owning MFR that are out of your "home" county, then maybe renting is a better choice.  Of course, 4 years of rent could add up to a LOT of money so there's opportunity cost associated with renting.

There's something else that might be more relevant at this point, and it's about your financing.  Even a duplex in need of a lot of work can run upwards of $400,000 (less in Ferndale, but with a little more systemic risk).  Prices will be much higher if they are turnkey and/or close to WWU, or in other highly desired areas.  I consider $400,000 a lot of money and I would make sure that it's something you would be reasonably comfortable paying.  Sure, a lot of your mortgage would be offset by the rental income of the other unit(s), but it's still something to look into.  Fortunately Bellingham has a lot of great loan officers familiar with MFR mortgage requirements and guidelines.  :)

Mary Kay Robinson · Answer

Ferndale runs a bit less in terms of bang for the buck in housing.  You an get more house there than Bellingham.  Also the commute to Bellingham is only 15 minutes from Ferndale - which is about the same time it takes to get across town in Bellingham!  As to property management companies, I would call them and get started on that asap as the rental market is VERY tight!  We have a 1-2% vacancy rate in Bellingham.  A balanced rental market is at least 5%.

Chauvin Rupley · Answer

Thank you for your response! To answer your question, my intention was to purchase and hopefully sell for a profit once my time in Bellingham is done. Being that I've spent the last 10 years in South King County and this area has become "home" for me and will eventually return here someday. I was shocked to see the inventory low and pricing high for Bellingham. Goes to show I don't know much about the area other than WWU is there and that it is my projected next job assignment! It's much of the same down here as far as inventory and pricing. I have been kicking myself in the butt for not buying a multi-family back in 2011 when I bought my SFR. Oh well. Still looking forward to living up north for a while! Maybe somethings will change.

Any knowledge on Ferndale? I have seen listings there with somewhat decent pricing. Also, are you in contact with property managers that may have single family rentals for my family and I? Currently using Craigslist for options but would love to open that up a bit. Thank you!

Mary Kay Robinson · Answer

Also, I am a Realtor with Windermere in Bellingham and have lived here 30 years so I know the Bellingham market well.  Happy to sit and chat any time!

How is the Bellingham WA market?

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