Hint: When a talk has a title that asks a question, be ready for either a one word answer, or a long, ambiguous, rambling response. In this case, Is Whidbey Changing? Yes. Change is a constant. In this specific case, the question was posed as the title of a talk and presentation held at the Langley Library. The topics were the island’s real estate, affordability, and trends as interpreted by an ex-engineer, writer, and real estate broker – me. If you missed it, don’t worry. I hope to make similar presentations at other places on the island. The hour and twenty minute live stream was also recorded on YouTube. Not short enough? OK. Here’s a synopsis of the summary of some data reduction and interpretation. Follow along on the slides available:
- Caveats – Folks make fun of statistics because people can play with statistics, and yet, data is real. Anecdotes are handy, but data is recorded history. Just be careful with definitions.
- If you think it’s tough nailing down a trend in the market, you’re right. Even getting various methods to agree on something as simple as one simple house generates a wide error band. Here’s the spread for my house. The good news is that, within statistics, the larger the dataset, the better chance that the errors cancel out.
- Good news. One chart. Median house prices are up. Talk, done. Well, not quite. Whidbey Island prices have finally recovered and have continued to climb, somewhat. Depending on your optimism or pessimism, it’s possible to draw different conclusions from only looking at the last few years or the last few months. When it comes to buying or selling, the ‘now’ is what’s important, but that’s too recent to show up in data. That will be true of every chart, sadly.
- Prices may be up, but the number of houses for sale is down. That’s not saying the number of houses is down, just that the number of them being sold is down. Fewer houses for sale means lower supply. Even if the demand doesn’t change, that’s pressure for the prices to rise – and they have.
- Live on Whidbey long enough and notice the population shift with the seasons. It affects the housing market, too. If it seems like there aren’t many houses in the summer, that’s bad enough. In the winter, well, any house that gets listed suddenly has a better chance of being noticed.
- The number of houses for sale is down in all price ranges. While the million dollar ones are down by about 40%, that only influences about a dozen homes in the count. The biggest drop is the houses under $300,000, the ‘affordable’ houses. From over 800 for sale in a month to under 300 is a big drop in the most affordable category. The consequence is that, even though there are fewer million dollar houses, they now make up about 20% of the market.
- Fewer houses without a discernible change change in demand also means houses sell more quickly.
- The rule of thumb is that about six months of inventory is a balance between buyers and sellers (though some say four months is the new balance point). Whidbey Island is heading below that point. Whether it gets down to Seattle’s level of only about a month of inventory is uncertain, but it is heading that way.
- One way to take out the variation in the numbers based on house size differences is to look at prices per square foot. The price rise continues.
- It’s probably not a surprise to those familiar with the island that South Whidbey is pricier than North Whidbey. The price swings are bigger, too. The military economy stabilizes the North Whidbey economy, and real estate market.
- Whidbey may seem less affordable, but relative to the other major islands in the Puget Sound, Whidbey is the most affordable.
- Whidbey may seem less affordable, but relative to Seattle and Bellevue, Whidbey is more affordable.
- Seattle still swings the markets, even on the islands. That quick uptick at the tail of Seattle’s curve represents more houses entering Seattle’s market than exist in Whidbey’s houses for sale. That potentially creates more supply, possibly moderating prices here and there.
- Seattle may seem less affordable than before, and radically less affordable than Whidbey; but Seattle is relatively cheap to the rest of the Pacific Rim. Want to develop a business beside the Pacific Ocean? Seattle is a relatively affordable alternative, hence more demand without an increase in supply.
- Links provided for those who want to deep dive into reconciling real estate data reporting methods across countries and continents. Fun work for data geeks like me, but not for free.
- Island County Housing Needs Analysis is a great document for diving into the island’s data. No surprise, North Whidbey’s median age is much lower than South Whidbey’s. A sign of change is the rapidly increasing median age for South Whidbey. People aren’t immortal (yet), so there will be turnover in households where the next generation doesn’t want to keep the family house. New people, new culture, a new identity possibly.
- It was sad enough that it took >3.7 times median income to afford a median house in 2000. Now the ratio probably exceeds 5 times. Incomes aren’t keeping up with housing costs.
- While the supply of homes for the market is low, the vacancy rate is high. Except for North Whidbey, the vacancy rates exceed 20% for the rest of the island. That’s thousands of homes empty, waiting for owners to visit on the weekends or in the summer. They are also a source for short term rentals. Long term rentals are important, too. They deserve their own analysis that would equally as lengthy as this is for buying and selling.
- Thousands of empty homes stand in contrast to a growing homeless population measured in hundreds. It’s overly simplistic for vacant homes to be opened to people in need. Idealism and reality conflict. So do pragmatism and compassion. The struggle for a solution continues. The good news is that we only lack proper policies and procedures, not actual buildings.
- Whidbey Island has traditionally had limits to growth in septic systems, water supplies, and transportation. Technology may change those limits. Whether policies and regulations allow them may simply be an eventuality considering the local, regional, and global pressures.
- Tiny houses, modular homes, and even greater acceptance of manufactured homes are growing, with the primary barriers again being policies, regulations, and procedures.
- People don’t want to sell until they can find something to buy,
but there’s little to buy because so few are willing to sell.
- The island is no longer as isolated as it was forty years ago. In another 40…?
Is that enough? Of course not, at least not enough to be comprehensive. No single presentation will cover all of the aspects of housing on Whidbey Island, but each can contribute to the conversation. I hope this helps.
You’re welcome and encouraged to share the video, the presentation, and this blog; and to contact me if you want to talk about such things in more detail. Every month brings new data, change is inevitable, and in real estate unpredictable.
Here’s another link to the video for the fuller story.
I’m happy to help.