Central Oregon housing prices are holding up remarkably well, but there is no question the market is shifting. How big a shift remains to be seen, and so far the data signals are small. The first is elevated inventory at a time of year when it typically declines steadily. The second indicator is a growing number of price reductions in the active inventory. Both factors mean increased competition for sellers.
Another major factor affecting our housing market is economic conditions that are increasingly weighing on buyer sentiment—inflation, with the most recent CPI print at 3.4% and Core CPI at 2.4%. Inflation is pressuring bonds, with the 10-year Treasury at 5.05%, the first time it has broken 5% since 2007. Mortgage rates are closely tied to the 10-year Treasury, and the national average for a 30-year fixed-rate conventional mortgage is 7.19% today, up from 6.89% last week. Lest you think the rise in mortgage rates is short-lived, Kevin Warsh of the Federal Reserve announced today a 25-basis-point hike in the overnight rate. Graham Summers, Chief Market Strategist for Phoenix Capital Research, believes bond investors expect three more 25-basis-point rate increases (linked above). Given that inflation was last below 2% in 2021, it is clear the Fed has not met its inflation mandate in years. All of this considered, expect more changes in the housing market over the coming months.
Today in Deschutes County, there are 1,429 single-family listings, down 12 from last week. There are 858 price reductions in the active inventory, or 60.04% of the active market, averaging 6.61%. The average days on market are 104. Seventy-six pending sales match last week, with 42 (55.26%) reducing the asking price by an average of 8.6% before securing a contract. Seventy closed transactions are up by 18 from last week, with 40 (57.14%) reducing their asking price by an average of 5.27% before securing a buyer. The sold-to-original-list-price ratio was 94.77%, with the average price per square foot at $395.
In Crook County, inventory is up by 5 to 269 single-family listings, with 153 price reductions (56.88%) and an average reduction of 6.96%. The average days on the market in Crook County is 134. Pending sales are up 4 from last week to 10, and 3 (30%) changed the asking price. Two of those changes were new construction, where the price went up slightly, with one listing dropping from $724,900 to $719,000 before securing a contract. Seven closed transactions are down by 1 from last week, with all seven reducing the asking price by an average of 10.44% before securing a buyer. The sold-to-original-list-price ratio was 83.28%, and the average price per square foot was $869. The week's largest sale was an extensive equestrian facility that closed at $6,800,000, skewing the price per square foot. Removing that large sale drops the average price per square foot to $316.
Jefferson County inventory dropped from 154 to 153, with 86 price reductions (56.21%) averaging 6.18%. The average days listed for single-family homes in the county is 141. Pending sales increased from 3 to 4 this week, with one price reduction of 2.56% before going under contract. Five transactions closed this week, up from 2 last week, with 3 reducing the asking price by an average of 2.06% before securing a buyer. The sold-to-original-list-price ratio was 96.68%, with the average price per square foot at $330.
With rising mortgage rates and increased inventory this fall, sellers need to price accordingly. While our market might not be falling right now, increased competition in the active inventory is creating many opportunities for buyers. Looking back to February 2026, mortgage rates hit a low of 5.99%, with many believing that marked the start of a downward trend for borrowers. From today’s vantage point, it looks like the days of the 7% mortgage are back, and likely to continue.
Quoting Graham Summers, “To be clear, 3.4% inflation is a long way from 2022. The economy is growing, payrolls are solid, and a Fed hiking into strength behaves very differently from a Fed hiking into a recession. I am not calling for a crisis.”
While higher borrowing costs are a headwind for buyers, that doesn’t change Central Oregon's desirability or the growth our region has experienced for several years. It does force sellers to be in tune with pricing, and as always, I am happy to provide a market analysis for your specific needs.
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