There are a lot of reasons for people to move to Bellingham, WA. Nestled in the heart of Whatcom County, Bellingham offers vibrant culture, spectacular scenery, and endless opportunities for outdoor adventure. But like many coastal communities in the Northwest, Bellingham is also gaining a reputation for expensive housing. Our property managers often get asked why rental property costs in Bellingham are so high. Ultimately, there are three main drivers behind the high prices we are experiencing in Bellingham home and rental prices.
Why Are Rental Property Prices So High in Bellingham?
- Gap between income and housing costs
As is the case across the United States, wages have not risen nearly enough in recent years to keep up with housing costs. Unfortunately, this issue has become even more pronounced in Bellingham, for a variety of reasons.
The median household income in Bellingham increased 15% between 2000 and 2017, while the median home value, adjusted for inflation, rose 67%.
Part of the problem stems from the fact that most of the homes built in Bellingham in recent years have been built to serve the needs of higher-income households. As long as there are buyers willing to pay more for homes in Bellingham, this imbalance persists.
There simply isn’t enough inventory of affordable housing to meet the needs of low to middle-income families. The problem can also be exacerbated by zoning, which limits the areas where affordable housing can be built.
- A desirable place to live
Part of the reason property values in Bellingham have soared is that it’s simply a desirable place to live. The city’s positive attributes continue to entice new residents at a rate that leaves the available housing inventory stretched thin.
Why do people want to live in Bellingham? There are a lot of reasons, ranging from great schools to a mild climate, low crime rates, and spectacular natural beauty and clean air.
This all adds up to a quality of life that is well above the national average. A residential survey published by the City of Bellingham in 2019 found that 93% of residents rated their quality of life either ‘good’ or ‘excellent.’ This attracts new residents and contributes to high property values.
- Lag between population growth and new home construction
Perhaps the greatest culprit behind high home prices in Bellingham can be traced back to the “great recession” between 2007 and 2013. During this period of time, the construction of new housing slowed down to a crawl.
But starting in this same time period, population growth soared in cities up and down the West Coast. Cities along the I-5 corridor experienced a population boom, driven largely by job growth in the region, just as new home construction slowed dramatically.
The population of Bellingham, Washington has risen 11.4% since 2010, while the number of new housing units being built has only increased by 9.7%. The supply has simply not kept up with demand.
This, of course, is not a problem unique to Bellingham. Statewide, the population of Washington has grown 12.2% since 2010, and rental rates and home values continue to rise as a result.
There are several ways to make housing more easily available (and more affordable) in Bellingham. First and foremost, new housing must be built, and a balanced proportion of it must be affordable housing.
To that end, there are steps that the City of Bellingham can take. These include making adjustments to zoning density, and offering tax breaks and incentives to the construction of new affordable housing.
Contact us to learn more about Bellingham property values, and talk to our team about how both renters and landlords can thrive with the help of professional property management in Bellingham.