Late fall is arguably the best time of the year for buyers, as many sellers are motivated to close before year-end. This year, mortgage rates are declining, with the national average for a 30-year fixed-rate Jumbo loan at 6.14%, and inventory levels are elevated compared to recent years. However, looming winter weather and holiday schedules lead to a seasonal decline in activity, inevitably slowing the market. This week shows a divergence in activity between the different price tranches, expected for the season.
This morning in Deschutes County, the inventory of homes for sale between $1 million and $1,999,999 decreased slightly to 319, down seven from last week. Supply remains elevated, but pending sales dropped significantly to ten from fourteen the previous week. Seven of the ten pending sales reduced the list price before securing a contract. There were ten closed transactions, down from 15 last week, with 6 of those sales reducing the list price before securing a contract.
Of the ten sales, two closed at full price, two were over the list price (+1.7% and +9%), and six closed below the asking price by an average of 5.08%. The average list price decreased by 7.4%. I recognize these numbers can get confusing, but here is an example of a home that sold on Titleist Lane, Sunriver: Original List Price $2,195,000, New List Price $1,975,000, Closed Price $1,800,000, representing a total decrease from the original list price of 17.99%. This example home, built in 1997, last sold in 2020 for $700k, with gross returns to the seller of 157.1%!
The inventory of homes listed in Deschutes County between $2 million and $2,999,999 decreased by 6 to 82 listings. Activity is up considerably, with four pending sales (one last week) and five closed transactions (also one last week). Two of the four pending sales reduced their list prices by an average of 8.29% before securing a buyer. Of the five closed transactions, three sold at the full asking price. Two of the closed transactions sold below asking, with one listed at $2,928,610 and selling at $2,750,000 (-6.1%), and the other listed at $2,900,000 and selling at $2,500,000 (-13.8%).
Deschutes County homes listed for over $3 million decreased by three to 45. Two pending sales listed at $3,999,000 and $5,700,000 occurred with no closed transactions. The pending sale at $5.7M, initially listed 450 days ago at $6.3M, went to an auction format to secure a buyer. In my analysis, the home was considerably overpriced, and it will be interesting to see what the final auction price was once the transaction closes.
Crook County inventory over $1 million decreased by one, now at 61 listings. There were no pending sales this week, with two closed transactions: $1,074,000 in Prineville on Oneill Highway and $1,399,999 in Brasada Ranch on Wooden Trestle Lane.
Deschutes County farm listings over $1 million are stable at 16 with no pending or closed transactions. Crook County farm listings over $1 million are stable at ten with no pending or closed transactions.
The weekend forecast is for stormy weather, with snow possible in Sunriver and in the higher elevations. Beginning Monday, sunny skies and slightly cooler temperatures will prevail, stretching out our fantastic fall weather. It is impossible to know how much the weather slows activity in the housing market, with the holidays likely the bigger factor in the decrease in transaction volume until real winter weather hits. On the 29th, the Federal Reserve will announce its next move on interest rates, likely a 25-basis-point reduction. Mortgage rates today are adjusting in anticipation of the next Fed move, setting up excellent conditions for buyers as 2025 winds down. However, the bigger impact in the housing market will be in the spring when the full implications of where rates settle have time to sink in.
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