The lack of homes for sale in Central Oregon is no more apparent than in the less populated counties of Crook and Jefferson, where the inventory of single-family homes this week are 133 and seventy, respectively, an increase of one for each county over last week. With so few homes available, it isn't surprising that of the three homes sold in Crook County, the days on the market were one, two, and seven, with all three homes selling at the list price. Three of the six closings in Jefferson County sold for less than full price at a median reduction of -6.38%. Available homes for sale in Crook and Jefferson Counties are nearly identical to this time last year.
In Deschutes County, there are 739 single-family homes listed, up seventeen from last week. This week in 2022, there were 705 homes listed in Deschutes County, but that number jumped to 766 in the third week of June. I anticipate the year-over-year comparisons will flip next week based on the slow pace of new listings. Pending sales this week are up 31k from last year at a median of 739k for the seventy-five sales and a median price reduction of only -4.08%. At this time last year, the median price reduction was -4.96% and over 6% before the end of July. An expected pause in rate hikes from the Fed should calm markets slightly, but all of the strong sales and firm prices are happening despite the 30-year national average for a conventional fixed-rate mortgage at 6.98% yesterday afternoon. Mortgage rates at this time last year were nearly a full point lower than today, illustrating just how strong buyer demand remains. Total sales this year to date are down 36.6%, and while I do not expect that we will surpass last year's sales volume, the gap should narrow in the second half of the year.
The Consumer Confidence Index is a tool for predicting market trends, released on the last Tuesday of every month. A number higher than 100 indicates consumers overall are optimistic about the economy, with numbers below indicating pessimism. The numbers for May were 102.3, down 4.1 from May 2022. The correlation between consumer confidence and real estate is uneven at best, and you could make a strong argument that declining confidence is a driver of demand for Central Oregon Housing. It takes few new, qualified, motivated buyers to keep our prices firm, which is a consistent theme for our market. However, at this time last year, despite stronger consumer confidence, buyers pulled back as the uncertainty of Fed rate hikes and the impact on the market were unknown. The dip in prices and home sellers' willingness to negotiate was short-lived, and prices were accelerating by March of this year. Whether the predictions for more Fed increases before year-end come true remains to be seen, but any reluctance from buyers seems to be in the rear-view mirror. Granted, higher mortgage rates have sidelined many, but enough buyers are engaged to keep prices firm and even increasing. The appeal of living in Central Oregon from out-of-town buyers is strong, with most seeing the light at the end of the tunnel on rising mortgage rates. If you can afford your mortgage today, a refinance down the road will only make your home more affordable. For most buyers, the bigger issue is finding the right property; when it comes up, they jump at the chance!
Constrained inventory today is a strong predictor of prices in the future. Based on the 2023 trends, there is every reason to believe 2024 home prices will remain strong and may accelerate depending on inventory levels. Unquestionably there are some concerning events in the overall economy, but the national economic engine is a beast not easily deterred. The stock market has outperformed expectations, making the BTFD investors (look up the acronym!) look like prescient beings. If our housing market is this strong in an uncertain economic climate, what will happen when the uncertainty gives way to increasing optimism? I still talk to buyers waiting for a collapse in home prices, and I completely understand many of the concerning issues. However, today's data does not reflect a coming apocalypse, and over the last few years, waiting has been a wash at best. Like a skipping vinyl record, this is the part where I espouse the benefits of a long-term vision in real estate! Asking anyone who purchased a home in the last ten years if they regret the price they paid should illustrate the point. While refinancing into lower rates might still be a couple of years in the future for today's buyers, where will the prices be with continued population growth and lower rates? Undoubtedly today's market is challenging, but for those that can navigate our current affordability, now might be a better time to buy than many realize.
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