With two months of 2023 in the books, trends in Central Oregon real estate are becoming easier to identify. One trend, rising mortgage interest rates, remained stable since last week, with the national average for a 30-year fixed-rate mortgage at 6.85%. A big part of the recent rate spike has more to do with the Fed's hawkish tone regarding future rate hikes than the hikes themselves. Whether or not rates today reflect a reset that calculates for further Federal Reserve rate increases remains unknown. However, looking back at the behaviors of the mortgage markets over the last several months, there may be resistance to breaking the 7% threshold. Seventeen of the sixty-one sales (27.87%) in Deschutes County over the previous week were cash deals, with thirty-eight (62.29%) using conventional financing, two FHA loans, one VA loan, and one seller-financed. Higher rates have not slowed down Deschutes County buyers.
The median sale price in Deschutes County last week was 600k and an average of 734k, in line with what we've seen over the previous several weeks. Remember that the weekly median sale price reflects the particular homes sold and changes dramatically weekly. For example, of the 355 homes sold since January 1, 2023, the median sale price is 620k.
Inventory levels are proving to be more important than higher mortgage rates. This week Deschutes County actively listed single-family homes dropped twenty-nine to 485, the first time below 500 since May 11, 2022, when inventory was at 481 and rising. Last year we reached the low of available houses in April, and with continued strong buyer demand, it appears we still haven't hit bottom. Last year from January 1 through March 1, there were 592 sold homes compared with this year's 355, showing a lack of listings and not excessive buyer demand. For reference, in the first two months of 2019, there were 480 sales. So while higher mortgage rates may not deter all buyers, they seem to keep more sellers on the sidelines. Moreover, this morning's available homes for sale are 27.5% lower than at the end of 2022. As a result, it is appearing less and less likely that there will be a spike in inventory during the first half of 2023.
In addition to all of the data above, in my local Realtor forums, there has been a noticeable increase in agents seeking properties on behalf of their clients. A large pool of qualified buyers appears to be actively looking for their perfect home. It isn't a stretch to anticipate multiple offer scenarios becoming more common if more homes are not available by the start of the second quarter. In addition, I talk to out-of-town buyers daily, and people's reasons for relocating here have not diminished. Unfortunately for buyers, nothing in the data so far indicates prices will decline significantly.
Using Deschutes County single-family homes as a baseline provides a solid market view. Although, every situation and price point has its nuance. Please let me know if I can help you decide if buying or selling in today's market suits you. Or, use the tools on my website for a snapshot view. Lately, I've seen an increase in owners using the home valuation tool on EnjoyBendLife.com, and in most cases, realistic values are towards the higher end of the given range. I am happy to run a specific market analysis if you need more than what this valuable tool provides.