A market upswing for selling houses that cost less than $300,000 is in store for Blaine and Birch Bay, according to Birch Bay realtor and local radio show host Mike Kent. “The sweet spot is from $200,000 to $250,000,” Kent said, citing figures that show “pendings,” houses on which a buyer has made an offer that’s been accepted but has not yet closed, are up almost 20 percent over the same period last year.
The picture remains anything but rosy, Kent said, but there is reason for some optimism even though “the number of sales in August dropped 29 percent over the same month last year,” saying that the higher number of pending sales cited above should make for a stronger fall market.
Kent cited three market forces that will help influence an upswing in sales. “Right now, first time home buyers, including those who have not owned a home in three or more years, get an $8,000 tax credit. There are also a lot of Canadian buyers looking for second or vacation homes. And finally, there will be a shortage of inventory in the spring because builders aren’t getting financing right now. It’s apparently a little too risky for banks to loan to someone who’s building a spec house right now.”
Kent also said that the market is very price sensitive, something he said was demonstrated by the difference between the average list price ($500,000) and the actual selling price ($221,000) in Blaine and Birch Bay.
“I expect a pronounced shortage of homes in Blaine in particular come early spring as there is little in the way of new construction coming out of the ground and as inventory starts reducing the builders will not be able to produce product in time for the uptick in demand,” Kent said. “This could put upward pressure on homes in the 200-250 (thousand) range in the first quarter of 2010.”