December 26, 2025

Local Market Trends, Inventory Shifts, Buyer & Seller Insights, and What You Can Expect in 2026

2025 Recap and 2026 Forecast

The Bellingham and Whatcom County real estate market has gone through a noticeable transition over the past year. After several years of rapid appreciation, intense competition, and limited inventory, 2025 marked a return to a more balanced and predictable housing environment.

In this market update, local real estate experts Justin Nelson and Paul Balzotti breaks down what happened in 2025 and what buyers, sellers, and homeowners should expect heading into 2026.

A Look Back at the 2025 Real Estate Market

The most accurate way to describe 2025 is flat but stable. While that may not sound exciting, it represents a major shift from the volatility of previous years.

After a strong spring market, activity cooled during the summer and fall. By year-end, both home prices and total sales volume finished nearly flat year-over-year, a result driven largely by higher interest rates and increased housing inventory.

Homes took longer to sell, buyers had more choices, and sellers had to be more strategic — all signs of a market returning to equilibrium.

Inventory Increased and Days on Market Lengthened

One of the biggest changes in 2025 was inventory growth. Where the market previously operated with less than two months of supply, buyers now experienced closer to four months of inventory in many price ranges.

This shift resulted in:

• More listings to choose from

• Fewer rushed decisions

• Increased negotiating power for buyers

Average days on market increased to roughly 49 days, a sharp contrast from the ultra-competitive years where homes sold in days or even hours.

That said, inventory levels varied widely by neighborhood and price point.

Multiple Offers Still Exist — But They’re Strategic

Despite the slower pace overall, multiple-offer situations did not disappear entirely.

Homes that were:

• Properly priced

• Well-presented

• Located in desirable neighborhoods

often still received multiple offers, particularly if they hit the market at the right time. The difference in 2025 was that buyers were more selective and less willing to overpay or waive important protections.

How Buyer Behavior Changed in 2025

For buyers, 2025 offered something rare in recent years: leverage.

Buyers had more time to:

• Review properties for sale

• Conduct inspections

• Negotiate price, repairs, or concessions

Instead of competing against dozens of offers, buyers could focus on making smart, informed decisions. This environment favored preparation and patience over urgency.

Interest rates remained a major factor, with many buyers closely watching mortgage movements before making a move.

What Sellers Had to Adjust To

Sellers experienced a different reality than in years past. The market no longer rewarded aggressive overpricing or minimal preparation.

Homes that sold successfully shared common traits:

• Accurate pricing from day one

• Strong marketing and presentation

• Willingness to adjust if activity slowed

Sellers who expected instant offers often needed to recalibrate expectations, but well-positioned homes still sold at strong values.

What to Expect in the 2026 Real Estate Market

Looking ahead, early forecasts suggest moderate growth and increased activity in 2026.

National projections indicate total home sales could rise meaningfully if interest rates stabilize or trend slightly downward. Locally, experts anticipate more transactions, but without the runaway price growth seen earlier in the decade.

Price appreciation is expected to be measured and sustainable, likely concentrated in the spring market before leveling off later in the year.

Interest Rates Will Remain the Key Driver

Mortgage rates continue to be the single most important factor influencing buyer demand.

Even a modest rate decline could:

• Bring sidelined buyers back into the market

• Increase competition for well-priced homes

• Boost overall transaction volume

Rather than fueling dramatic price spikes, increased demand would more likely lead to healthier market movement.

Policy Changes May Impact Housing Supply

Local planning initiatives, including potential updates to Accessory Dwelling Unit (ADU) regulations and zoning adjustments, could create new housing opportunities in Bellingham and surrounding communities.

These changes may:

• Encourage small-scale development

• Increase housing flexibility

• Provide new options for homeowners and investors

Over time, this could help relieve some supply constraints while supporting long-term growth.

Market Performance by Price Range

Not all segments of the market are moving at the same pace.

• Entry-level and mid-priced homes continue to see strong demand, particularly those under the mid-$800,000 range.

• Higher-end and luxury homes face longer selling timelines and greater competition due to increased inventory.

Understanding these differences is critical when pricing, buying, or selling in 2026.

Seasonality Is Returning to Normal

Traditional seasonal patterns are re-emerging.

Spring and early summer remain the most active periods for buyers and sellers, while fall and winter are slower but still present opportunities — especially for motivated participants.

Final Takeaway

The Bellingham and Whatcom County housing market is no longer defined by extremes. Instead, it is settling into a balanced, strategic, and opportunity-driven environment.

For buyers, this means more choice and less pressure.
For sellers, success depends on pricing and preparation.
For investors, policy changes and market stability may open new doors.

As always, local expertise matters. Understanding neighborhood-level trends, pricing dynamics, and timing can make all the difference in achieving your real estate goals.

Contact Justin Nelson directly at [email protected]