My Weekly Central Oregon Real Estate Blog

Only ten days into 2024, activity has already begun to pick up in the housing market. Between all the speculation that the Fed will lower rates, Janet Yellen declaring a "soft landing" with no recession in sight, and with limited inventory, the year looks like it is shaping up to be interesting. While I am sure Yellen has an agenda with her messaging, I encourage you to look back at her track record before hanging your hat on her proclamation. However, the hype is making its way to housing.

In addition to my weekly breakdown of Deschutes, Crook, and Jefferson County housing activity, I will cover a 2023 year-in-review for Bend today. As the largest city in Central Oregon with a little over 100,000 residents, Bend makes up the majority of sales in Central Oregon. But first, let's take a look at last week's activity.

Crook County has 108 active listings this morning, up four from last week. There were nine pending sales at a median of 399k, an average of $464,077, and eighty-three days listed. The days listed for pending sales are ten less than the active listings. One home sold after 260 days on the market at 88,24% of the original list price. The sold property was on the north end of Juniper Canyon and sold for $525,000. Even though inventory in Crook County increased slightly this week, there are so few properties for sale that sellers are finding buyers for homes that have lingered on the market. This trend applies across Central Oregon.

Jefferson County saw an increase of five listings this week, now at Seventy-eight. However, the three pending and three closed sales were on the market for eleven and twenty-one days, respectively. The median pending sale was $399,000, and the closed sales were $445,861. 

Deschutes County inventory decreased again this week and is now down to 599. With the major holidays behind us, pending sales picked up to fifty-six at a median of $641,400 and an average of $768,308. Forty homes closed last week at a median of $689,000 and an average of $812,655. Active listing's median days on the market are eighty-nine, pending is fifty-six, and sold is forty-four. As a recap, Deschutes County single-family home sales in 2023 were down 23.5%, with the median sale price of $665,000, a 2.2% drop from 2022. The average sale price was $812,278, a 1.7% drop from 2022. Inventory on this week last year was twenty-six fewer than this year, but prices this week are up considerably. The median pending sale price for this week in 2023 was $567,400, with the average at 720k.

For those of you who have followed my 2023 year in review for the different cities in Central Oregon, the Bend numbers won't be surprising. The trends of fewer sales and slightly lower prices for the year-over-year comparison continue in Bend. 

In Bend in 2023, there were 1930 single-family sales, a 22.9% decline from the 2502 sales in 2022. The median sale price decreased by 15k to $750,000, a 1.96% decline. The average sale price dropped 1.6% to $914,922. 

Condo and townhome sales in Bend declined 17.2%, with 197 closed transactions, down from 238 in 2022. However, the median sale price increased by 4.28% to $585,000, while the average of $695,559 declined by $93 or 0.013%. With condos and townhomes only making up 10% of the sales in Bend, this market segment is in short supply, keeping prices firm. Many condo buyers are looking for turnkey properties suitable for rentals and requiring less maintenance than a single-family home. I expect market forces to keep activity strong. 

Ninety-four manufactured homes on land sold in Bend in 2023, down from 117 sales in 2022. The median sale price was $422,500, a 2.87% drop from 2022. The average sale price was slightly lower at $422,148, reflecting a 7.06% drop from the 2022 average. Consistent with the rest of Bend, sales declined 19.6%.

One thousand eight hundred forty-seven single-family homes in Bend sold below $2M at a median price of $729,000 and an average of $835,862. The price declines were 2.14% for the median and 1.6% for the average. While Bend home prices were stable from the peaks of 2022, the data shows that most Bend sales are happening well below $1M. Sales below $2M reflect a 22.8% decline from 2022.

Eighty-three homes in Bend sold over $2M in 2023, a 23.1% decline from 2022. The median sale in this price bracket was $2,395,000, a 3.52% decline, and the average sale was $2,674,239, a drop of 1.2%. Limited inventory is the most significant limiting factor to sales above $2M. Many buyers in this price point have specific needs that are difficult to find in Bend. As 2024 unfolds, I expect our supply-constrained market to continue, challenging the higher price points. When a home fits your needs, waiting has proven to be a mistake with so much buyer demand. Once a great property sells, knowing when another suitable home will hit the market and at what price is difficult. 

Across all property types in Bend, there were 2,244 sales in 2023, a decline of 22.3% from 2022's lofty 2,889 sales. The average sale was $867,107, with a median of $720,000. Declines were 1.8% and 1.37%, respectively. Total sales across all property types in Deschutes County were 3758 at a median of $629,900 and an average of $758,548. The median days of closed transactions in Deschutes County was twenty-two, with Bend coming in slightly lower at nineteen. It is easy to see that throughout Deschutes County, sales happen quickly, even with a slowdown in sales volume. Bend prices and buyer demand surpass the county by a fair margin, and that trend will continue.

On the southern end of Deschutes County, I still have Sunriver and Three Rivers South year-end reviews coming. Expect Terrebonne and Madras reports soon on the north and into Jefferson County. Each region of Central Oregon has its characteristics. Still, the overall trends in 2023 were the same: fewer sales and slightly lower prices. Some analysts have predicted a nationwide increase in homes for sale in 2024. However, here in Central Oregon, inventory remains low, and Deschutes County inventory is in decline. A lot will happen over the next several months, with the beginning of this year looking like a carbon copy of last year with low inventory, firm prices, and higher interest rates. 

This morning, the national average for a 30-year fixed-rate mortgage is 6.8%. Yesterday, I read a prediction that mortgage interest rates will be 6.6% by year-end. That is a far cry from the pivot the industry is pushing. Staying in contact with your lender and recognizing the right home for you are vital in this environment. 

Much research and my local knowledge go into helping my clients find their perfect fit. I am always happy to go above and beyond to help you make the right decision. Don't hesitate to contact me with any questions about housing in Central Oregon!

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Welcome to 2024! Now that we are officially in the new year, the two most significant impacts on our housing market will be buyer demand and inventory levels, which drove the last few years of rising prices. 

In addition to my weekly breakdown of Deschutes, Crook, and Jefferson County, I will dive deeply into Prineville and Brasada Ranch today. Over the last three weeks, I highlighted Sisters, Redmond, and La Pine, and in the following weeks, I still have Madras, Bend, Sunriver, Terrebonne, and Three Rivers South on my list. 

Did prices rise in 2023? Let's first look at Deschutes County single-family homes in 2023 compared to 2022.

In 2022, 4,128 single-family homes sold in Deschutes County at a median of 680k and nine median days on the market. The average days on the market were twenty-eight, which is a better metric for evaluating the super-charged year of sales. As hot as sales were in 2022, each year since 2015 had more sales. With interest rates rising steeply at the end of 2022, I look at the year more as the start of the slowdown than a hot year. While sales may have slowed, 2022 produced peak pricing for Deschutes County. In 2023, Deschutes County had 3,150 sales at a median of 665k, with the median days on the market at twenty-two and forty-eight average days listed. That is a 23.7% drop in sales volume and a 2.2% price drop. 2023 sales volume was the lowest since 2010, when sales were 3,197, and the median sale price was 176k. In 2010, Central Oregon was still in the throes of the housing crash, with increased inventory and weak buyer demand. 

This morning in Deschutes County, there are 607 single-family homes listed, down fifty-four from last week. The median list price is $749,900 at eighty-five median days on the market. Thirty-three homes are pending at a median of 599k and thirty-six days on the market. Thirty-one homes sold in Deschutes County at a median of 700k and sixty-five days on the market. Volume for the last week of the year was typical for the holiday-fractured week and slightly exceeded this week in 2022. Many listing contracts expire at year-end, and the significant drop in homes listed is typical at the start of the year. Many sellers hold off on listing until the peak selling season approaches, and I expect inventory to continue to decline due to fewer listings combined with sales. The low point in 2023 was 485 listings on March 1. 

Jefferson County inventory declined to seventy-three this morning, down seven from last week. One home is pending in Crooked River Ranch at 649k and thirty days listed. No homes closed in the last week.

Before we evaluate Prineville, let's look at Crook County for the week and compare 2022 and 2023.

Crook County has 104 listings, a drop of twelve from last week, at a median of $564,450, and ninety-seven days on the market. There are three pending sales at a median of 307k and forty-four days listed, with two closed transactions at a median of 330k and sixty-four days on the market. 

In 2022, there were 431 sales in Crook County at a median of 455k and twenty-one days on the market. In 2023, there were 357 sales at a median of $449,015 and forty-nine days listed. The 17.2% drop in sales volume is considerable, but the 1.3% price drop is negligible. 

While Crook County and Prineville are inseparable, Brasada Ranch skews the numbers skyward. This morning, eighty-two single-family homes are listed in Prineville at a median of $471,400 and ninety days listed, compared with Brasada Ranch's seven listings at $1,490,000 and 127 days on the market. Three homes are pending in Prineville (the same homes reflected in the Crook County numbers above), with no pending or closed sales in Brasada Ranch last week. 

In 2022, Prineville had 365 sales at a median of 435k and twenty-one days on the market. In 2023, sales dropped to 296, but the median sale price was only down two dollars fifty cents! Under normal circumstances, an 18.9% drop in sales volume would equate to lower prices, but with so few homes for sale, that has not occurred. 

Brasada Ranch closed thirty-three homes in 2022 and thirty-two in 2023, and the median dropped from $1.3M to $1,182,500. Looking at the sold properties, the mix was more modest in 2023, with fewer large trophy homes sold. Comparing apples-to-apples in Brasada Ranch, the pricing in 2023 was consistent with 2022.

In the first half of 2023, prices were down in Deschutes County by nearly 6%, but as the year progressed, the gap narrowed to our year-end drop of 2.2%. As illustrated above, some neighborhoods and cities in Central Oregon fared even better with the year-over-year comparisons. As the new year unfolds, Deschutes County inventory is down five from this week in 2022, indicating another year of tight inventory. Whether we begin building inventory, drop further, and when we reach the low point will be good leading indicators for what is in store. Granted, a big shakeup in the overall economy could derail the current trends, just like the sudden rise in interest rates in late 2022 stalled our record-breaking pandemic-fueled market. However, just like our El Niño winter makes the chances of catching up on snowfall increasingly unlikely, today's low inventory makes the chances of an over-supply of homes for sale a long shot.

Stay tuned next week for another deep dive into the Central Oregon Housing market!

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First, I hope you had a great Christmas with family and friends! It is hard to believe the year will be over in a matter of hours!

Second, in addition to my usual breakdown of the Deschutes, Crook, and Jefferson Counties activity, I will provide year-to-date data on the City of La Pine. Let's get to it!

This morning in Deschutes County, there are 661 active listings for single-family homes at a median of 750k and eighty-six days on the market. Nearly half of those listings (323) have had a price change at a median of -4.55%. This week last year, there were 668 listings. The county recorded thirty sales in our holiday-shortened week at a median of 640k and fifty-one days on the market. The median price reduction for the pending sales sits at a paltry -3.89%. Twenty-seven homes in Deschutes County are pending at a median of 665k, with forty-three median days listed and thirteen price reductions at a median of -10.59%.

As you can see from the days on market numbers, new listings are either more attractive, priced better, or a combination of both factors. Also, many higher-end homes listed take longer to find a buyer, dragging the day's listed number up for the active inventory. At year-end, Deschutes County numbers are remarkably similar to the end of 2022.

In Crook County, there are 116 single-family homes listed, down from last year when there were 125 listings this week. The median list price is 597k, with sixty-five price reductions since listing at a median of -5.03%. The median days of active listings is 104, one more than the pending days listed of 103. Four homes are under contract at a median of 505k and a median price reduction of -3.8%. Four homes closed at a median of 375k, with all four taking a price cut before selling of a median -5.05%. This week last year shows five pending and three sales, so Crook County is performing slightly better than last year. However, with the shorter work week and light activity, I would not read too much into this weekly data. Interestingly, when I removed the six active listings in Crook County over $2M from the list, the median list price dropped to 525k. I will dive deeply into Crook County, Prineville, and the popular Brasada Ranch golf community in the coming weeks.

Jefferson County inventory has been stable at eighty listings for the past three weeks, with this morning's median price at 472k and eighty-one days on the market. The county had one pending sale at 345k at a price reduction of -5.48% and six sold homes at a median of $327,500 to round out the week. Of the sold homes, three took offers at a median of -11.43% below the asking price, indicative of the deals sellers are entertaining in the outlying areas of Central Oregon. This week last year, Jefferson County inventory was eighty-one, with three pending properties and two sales. Jefferson County and Madras breakdowns for 2023 will be coming shortly.

Lastly, in La Pine, sixty-nine single-family homes are listed at a median of 539k, with 100 days on the market. One sale was recorded this week at 215k and only four days on the market, with the list price at 225k. One home is pending in the Ponderosa Pines neighborhood, listed at 475k. However, this home was on the market for 510 days and started at 599k! A combination of a slowing market in La Pine and an aggressive price account for the considerable reduction and significant days listed. In today's housing market, buyers can access tremendous information and immediately recognize value or over-priced properties. While some sellers are okay with waiting for the right buyer, it is best to price right directly in most cases.

Thirty-three manufactured homes, including land, are listed in La Pine at a median of 342k and a short thirty-nine days on the market. Not all of these homes qualify for financing, requiring a cash sale in some cases. Although, for the homes that qualify for FHA, VA, or Conventional financing, there are some great opportunities. 

In 2022, year-to-date, La Pine sold 267 single-family homes at a median of 465k and thirty-four days on the market. So far in 2023, there have been 186 sales at a median of $422,400 and forty-seven days on the market. Those numbers reflect a 30.3% reduction in sales volume and a 9.16% median price drop. La Pine heated up tremendously in the wild 2022 selling season, but sales and prices are softening as the market continues a stable return to something resembling normalcy. 

Sales of manufactured homes, including land in 2022 in La Pine, were 138 at a median of $356,500 and twenty-eight days on the market. Year-to-date 2023 shows 105 sales at a median of 342k and days on the market of thirty-nine. That's a 23.9% reduction in sales and a 4.07% reduction in price. Whether manufactured or stick-built, the floor for move-in-ready homes in Central Oregon remains stubbornly close to 400k. In most cases, the lower-priced homes in our market see more modest price reductions than many higher-priced homes shooting for the moon. 

Available inventory is the best predictor of future pricing as we wind down the year and begin anew in 2024. My year-end reports for the communities of Central Oregon will continue until I have covered the region. They are a great resource to show where the market stands relative to 2022, comparative inventory, and where we might be heading. Stay tuned for more reliable data straight from the Central Oregon MLS!

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With only a handful of days remaining in 2023 and the holidays in full swing, the 2024 housing market begins today. A key metric to watch heading into the new year will be available inventory, so let's dive in!

This week, I will break down the past year in Redmond, but first, a look at the Central Oregon County data.

In Deschutes County this morning, there are 688 single-family homes for sale, down two from last week and six from this week in 2022. Thirty-six homes are pending at a median of $657,498, with thirty-four sales at a median of 691k. Sales and pending sales were down from last year's week of thirty-seven and forty-five. The inventory levels are a valid comparison, but sales and pending sales during the holidays are subject to so many variables that I wouldn't read too much into the reduced activity. 

Crook County has 120 active listings, down one from last year's week and eight from the previous week. The median list price this week is just shy of 600k. Removing the nine listings in Brasada Ranch drops the median list price in Crook County to 515k. County-wide, seven pending sales, at a median of $525,555, and four closed transactions, at a median of $699,250, made for a solid week of activity. One sale and two of the pending sales were in Brasada Ranch, which has shown robust activity throughout the year. 

Jefferson County inventory remains at 80, the same as last week and one less than this week last year. There were two pending sales in the county at a median of $374,450 and five closed transactions at a median of $401,424 to round out the week's housing activity. 

This morning in Redmond, there are 169 active single-family listings at a median asking price of $599,900 and seventy-nine days on the market. In the last week, nine homes in Redmond went under contract at a median of $499,900 and fifty-one days listed. Three homes closed in Redmond this week at a median of $532,400 and ninety-six days on the market. There were 932 year-to-date 2022 sales in Redmond at a median of $532,750 and only ten median days listed. This year, as of this morning, Redmond has had 684 sales at a median of $502,250 and twenty-four days listed. Sales in 2023 are down 26.6% from 2022, with the median home price down 5.7%. Redmond is a rapidly growing community, reflected by new subdivisions and plenty of new construction, with sixty-five of the 169 single-family listings constructed in 2022 or later! With a charming downtown and a more laid-back vibe than Bend, Redmond appeals to many people looking to put down roots in Central Oregon.

On December 19, 2022, the national average for a thirty-year fixed-rate mortgage was 6.31%, compared to this morning's rate of 6.64%. Last year, uncertainty about the housing market ruled the day, as well as how high mortgage rates would go. On October 16, 2023, rates peaked for the year at 7.94%, a high not seen since May 2000 when rates were 8.43%. The rate peak in May 2000 preceded a twenty-year decline in rates that set the stage for the 2008 housing crash and finally bottomed out at 2.69% in December 2020. The Dot Com crash in the early 2000s, overseen by Fed Chairmen Alan Greenspan followed by Ben Bernanke, brought on an era of cheap credit that has inflated home prices ever since. Today, historic home unaffordability is a home price problem far more than an interest rate problem. 

Whether it was Ben Bernanke in 2008 telling Congress that there was "no recession in sight," Janet Yellen commenting that quantitative tightening would be "like watching paint dry," or current Fed Chairman Jerome Powell spinning on his heels to proclaim the Fed is considering rate pivots in 2024, the one clear thing is the Fed seems to be the last to recognize a coming recession. Wall Street seemed immune to Powell's forward guidance about "higher-longer," always looking towards the pivot. Yet, the champagne corks started popping based on his recent statement about a pivot, Powell's remarks akin to a hostage statement. In the days following Powell's rapid change of heart, several Fed Governors took to the press to walk back the doveish comments. Still, the mainstream media and many in the real estate industry have reacted as if a pivot has already happened, proclaiming a new landscape for the 2024 housing market. 

First, today's lower rates are a boon to buyers and something to take advantage of if you are actively looking. Many lenders suggest rate locks, and there is an unquestionable opportunity to secure a loan at a considerably better rate than just a few weeks ago. Combine an interest rate buydown with today's lower rates for loans well below the bare rate.  

Second, if you are going to listen to Powell's talk of a pivot, you also need to listen to the rest of his statement. Cherry-picking what you want to hear is not a sound strategy. Powell and his Governor's batting clean-up reiterated that data indicating inflation consistently heading towards the target needed to precede a pivot. Much of the inflation comparisons written about in financial reports and presented by the mainstream media have used year-over-year comparisons, while month-over-month inflation has risen. The Fed relies heavily on Core Inflation numbers, which back out volatile food and energy costs, while the media has been touting lower energy costs as a sign of lower inflation.

Unfortunately, you can't have your cake and eat it, too. Also, unfortunately, the recent turmoil in the Red Sea will likely cause inflation for the costs of goods shipped and energy. Putting all the massaging of numbers by the Bureau of Labor Statistics aside, the year-over-year inflation comparisons in the coming months will likely look far less encouraging. You might recall that Jerome Powell touted the increase in bond prices, doing some of the heavy lifting for the Fed, in essence, tightening monetary policy. The positive impact has diminished since bond prices have fallen, making the pivot Powell so cavalierly mentioned less likely anytime soon. However, a pivot based on political motives remains a possibility. But the Fed isn't political! In a few short days, it will be an election year, and the pressure by an incumbent administration on the Fed has been equally applied by both sides of the aisle, one of the biggest wild cards of the coming year.

Home purchases should have a long-term focus, especially in a market like we are experiencing today. Lower rates today are great, and this time of year creates fantastic opportunities relative to peak season pricing. In the long term, Central Oregon is a tremendous investment. Currently, nationwide inventory is up, while Central Oregon inventory is down, a strong indication of buyer demand for our region. I am not bearish on Central Oregon but a realist regarding the financial realities. Be cautious moving forward. A pivot in rates and monetary policy will likely bring home prices up. Whether you want to call that appreciation or a bubble is up to you. However, Jerome Powell claims that appropriate economic indicators are essential before a pivot, and to date, those indicators have not materialized. 

Next week, I will highlight another city in Central Oregon as I continue my year-end reporting on the Central Oregon housing market. Who knows? I may get into the weeds on the repo, reverse repo, and commercial real estate markets to reveal more of the issues I see percolating beneath the standard reporting. 

Merry Christmas! I am working through the holiday, so feel free to reach out if you need anything.

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In this week's report, I will detail the Sisters market, showing the differences year-over-year. But first, a brief overview of the three counties of Central Oregon.

This morning in Deschutes County, the inventory of available homes for sale dropped below seven hundred for the first time since the first week of June, and it is now at 690. This morning's inventory is down thirty-one from this week last year. Fifty-four homes were placed under contract at a median price of $665,650, with another thirty-nine sold at a median price of $759,900. The median days on the market for active listings is seventy-six, forty-six for the pending sales, and twenty-two for the sold properties. Activity always picks up as the year winds down, although the recent drop in mortgage interest rates seems to have spurred some action. Many properties on the market for some time are getting snapped up as they compete better with the smaller pool of available listings. Seasonal declines in inventory and the filtering dynamic happen in any market. However, with our supply-constrained conditions, the filtering process is amplified. 

Available inventory at this time of year, along with sales prices, is a leading indicator of the spring housing market. Last year, the inventory low point was in early March. With homes for sale trending below last year, it will be telling to see when inventory reaches the bottom in 2024. The meager inventory has moderated the impacts of higher interest rates as buyers have very few options, keeping prices firm. At least for the first half of 2024, I do not expect mortgage interest rates to change much. Many overly optimistic analysts predicting several rate cuts through 2024 have backed off that assertion as inflation has been up for four of the last five months, with the outlier a flat month. Jerome Powell has repeatedly indicated he will keep rates higher for longer in the fight against inflation and hasn't ruled out another increase. Wall Street's propensity for ignoring Powell's narrative is misguided. In short, I do not expect interest rates to change much for the coming year. 

This morning in Crook County, there are 128 single-family homes for sale, down seven from last week. This week in 2022, there were 130 active listings. Watching the inventory in Crook County during these times of low availability, it appears the market has reached a low point and is not breaking considerably down from current levels. The low point for the year was in late April at 107 listings. However, sales at current prices have slowed, with another week of zero sales. That makes two out of the last four weeks in Crook County with zero closed transactions. Before the first week of zero sales in late November 2023, every week going back to July 2022 shows closed sales. Considering the time of year, I wouldn't put too much weight on the absence of closings, although it indicates slow sales for the county. 

Jefferson County shows eighty active listings, down one from last week and the same as three weeks ago. This week last year shows eighty-three listings. Like Crook County, Jefferson County has reached a stasis point for the current low inventory environment. With five pending sales and three closings, Jefferson County shows typical activity for the week. Even though sales are down, price reductions are trending below 5% of the asking price. While there are certainly deals available in both Jefferson and Crook County, with such limited inventory, there is a hard floor on how low sellers are willing to go. 

This morning in Sisters, thirty-eight active single-family listings are at a median asking price of $972,500. One pending sale at 585k, with five closed sales at a median of 890k, wrap up the weekly activity. There is tremendous diversity in price and the type of property listed in Sisters, giving buyers with specific needs few options. 

For 2022 year-to-date in Sisters, 211 homes sold at a median of 750k and seven days on the market. For 2023, sales are down to 173, a median of 720k, and 26 days on the market. While this year may not be as red-hot as 2022, sellers have a solid advantage based on the remarkably low inventory. Without more homes for sale, it is unlikely conditions will change significantly in Sisters. Unique properties in great locations are still selling quickly. Of the available single-family homes, six are new construction at a median asking price of $812,400. Sisters is such a beautiful community with excellent access to hiking, the Pacific Crest Trail, Hoodoo Ski Resort, and the Metolius River that it is not surprising it is one of the most desirable locations in Central Oregon. 

There are no active listings in nearby Camp Sherman, but ten sales year-to-date at a median of $765,500. Camp Sherman sits at the headwaters of the Metolius River in the shadow of Black Butte. Many homes available in Camp Sherman are on the Metolius River, and sales are brisk, so act fast if something comes up! No matter the market conditions, Camp Sherman properties do not sit for long.

Rounding out the Sisters options is nearby Black Butte Ranch, an idyllic resort community with golf and recreation opportunities abound. There are seven properties in Black Butte Ranch at a median sale price of $1,595,000, with one pending sale listed at 825k. Fourteen homes sold year-to-date at a median of $1,090,000 and forty days on the market. Contrasted with sixteen sales year-to-date 2022 at a median of $1,320,000 and seven days on the market, Black Butte Ranch activity is strong. Like Sisters and Camp Sherman, the properties available are diverse and limited, and I would refrain from reading too much into the lower median sale price. In communities like these, lower prices year-over-year have more to do with the mix of homes sold than price retreats. 

Stay tuned next week as I break down the activity of another community in Central Oregon!

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As the year draws to a close, the closed transaction data begins to paint a picture of what the new year may have in store for the housing market. This week, I will focus on single-family homes on a county-by-county basis. In the coming weeks, I will dive deeper into the individual cities of Central Oregon to provide you with more specific information to illustrate the year-over-year changes. 

This morning in Deschutes County, there are 709 single-family listings, a drop of forty-one since last week. This week last year showed 745 active listings in Deschutes County, indicating that our supply-constrained market will continue. Available inventory will be a solid leading indicator for home prices as the 2024 market shapes up. Fifty-seven sales are pending, and forty-seven sold at a median sale price of $748,240. Year-to-date 2022, there were 3984 sales compared to 2993 this year. While 2023 sales volume reflects a -24.9 % decline, the median sale price has only dropped -2.64%. The median sale price has narrowed as the year progressed, with buyers seeing year-over-year median sale price declines in the high 5% range in the first half of 2023.

Interestingly, the housing market reacts more to abrupt changes than actual numbers, and as mortgage interest rates began to rise late last year, many buyers pulled back, and many sellers were motivated to make a sale. Looking back, I attribute this to the uncertainty of where the market could wind up and talk of a recession that would take a significant bite out of potential sale prices in 2023. Median prices across the county are only a snapshot of the market, and individual property pricing depends on many factors. However, early this year, most buyers would not have believed that prices in Deschutes County would only decrease -2.6% across the board. 

Jefferson County has eighty-one homes listed this morning, up one from last week. On this week last year, there were eighty listings, showing year-over-year stability. Zero properties were placed under contract last week, with five sales at a median of 605k. Year-to-date sales are 197, down from 299 in 2022, a drop of -34.1%. The median sale price dropped from 400k to 390k, -2.5%. While the price drop in Jefferson County is in line with Deschutes County, and the inventory is stable, the more considerable reduction in sales volume could be a sign of prices softening heading into 2024. The median price reduction has increased to -6.07% from -4.07% in 2022. Every property throughout Central Oregon has unique circumstances, but double-digit price reductions were more common in Jefferson County this year than in many other regions. The metric to watch that will drive future prices in Jefferson County will be sales volume compared to 2023. A further reduction from this year's lows will motivate sellers to take advantage of any offer, softening prices. Substantial sales volume would have the opposite effect. 

Crook County's inventory declined by five to 135 active listings this morning. This week last year, Crook County had 132 active listings. Sales year-to-date are 339, down 17.5% from 2022's 411, the smallest drop in sales volume in all three counties of Central Oregon. This year's median sale price is 449k, down from 465k last year. Crook County, minus the sales from Brasada Ranch, shows 310 sales in 2023 from 379 in 2022, a drop of 18.2%. The median sale price has remained remarkably stable, only dropping four thousand dollars to today's 440k, a reduction of .9%. Brasada Ranch sales declined by three, with twenty-nine so far this year. While the sales decline is marginal, the median sale price increased slightly to $1.3M, up 1.4%. The combination of desirability and low inventory in Crook County, including Brasada Ranch, are strong leading indicators of price stability heading into 2024.

Days on the market have increased, returning to more typical marketing times. Desirable homes continue to sell quickly, but opportunities are available for the homes lingering, especially during the off-season before the market picks up again this coming spring. 

Rising interest rates have a lag effect on the markets, and there is every reason to believe the rapid rate increases of the last year have yet to impact the market entirely. Wall Street, to date, has priced in future rate decreases, although lately, more bank CEOs are accepting that Jerome Powell means it when he said rates will remain higher for longer. Recent relief in mortgage interest rates is welcome news for buyers, but the question remains if this is a blip along the way or the beginning of a pivot. The talk of recession has changed direction so many times over the last few months that it is dizzying. Economic data shows reasons to be concerned, alongside much optimistic data. Some analysts feel we are balancing on a precipice, while others believe the market is ready to accelerate. Without significantly more inventory, lagging sales, and increased days on the market, home prices in Central Oregon are unlikely to change drastically. Unlike our local trends, the national housing market is experiencing more inventory and decreased prices. Admittedly, significant economic downfall can apply pressure to housing rapidly. I encourage buyers to take a long-term view of housing. Short-term fluctuations in home prices have had little impact over the long-term rise in home prices, and a quick look at the Case-Schiller Home Price Index illustrates this clearly. In addition to these weekly reports, now is a great time to keep an eye on the Central Oregon Market Trend Reports at www.EnjoyBendLife.com/Market-Trends/, and at the bottom of that page, you will find the Home Price Index, along with more helpful economic data. 

Stay tuned for a city-specific analysis of the Central Oregon Housing Market over the coming weeks!

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As expected with the holiday-shortened week, activity in the Central Oregon housing market slowed over the last seven days. In Deschutes County this morning, there are 750 active listings, down fourteen from last week. Pending sales were thirty-three, with seventeen closed transactions—the pending activity aligned with the previous year's week, with the sales exactly half. The median sale price for the week was 750k, nearly 100k higher than the year-to-date median sale price, with an average of 924k. Interest rates have softened a bit, sitting at 7.3% this morning.

Crook County inventory dropped four to 140, with two pending sales and five closed transactions. Two of the five sales were in Powell Butte and Brasada Ranch at $1.43M and $1.44M, respectively, leaving the average sale price of the three Prineville area homes at $469,897. 

Jefferson County inventory increased by two and is now at eighty active listings. Seven sales were pending, with one home sold for 410k. 

The seasonally lower inventory is striking in the small community of Sisters, where there are only forty-one active listings. Of the two homes placed under contract in Sisters last week, one listed for 625k north of the Aspen Lakes Golf Course, and the other near Black Butte Ranch listed for $1.395M. There were no closed transactions in Sisters last week. Year-to-date, Sisters has closed 162 homes at a median of 719k. So far this year, the least expensive home sold in Sisters went for $470,463, while the most expensive sold for $15M! Year-to-date, in 2022, there were 201 sales in Sisters at a median of 740k, with the most expensive sale at $6.8M. The City of Sisters has a wide range of property types and sizes, with several "trophy" home sites, genuinely remarkable properties, and more affordable homes near downtown. 

Heading down to La Pine, one of the fastest-growing communities in Central Oregon, there are seventy active listings today at a median of 550k. Four homes were pending last week at a median of 337k, with two sales. The sold properties closed at 450k and 525k. Last year, there were 259 sales in La Pine at this point of the year at a median of 465k, compared to 178 sales so far this year at a median of 425k. 

Another Central Oregon community seeing rapid growth is Redmond, home of the Eagle Crest Resort and the largest airport in the area. This morning shows 179 homes listed in Redmond at a median of 599k, with ten pending sales at a median price of 537k and two closed sales at 375k and 557k. Year-to-date, Redmond has closed 662 single-family homes at a median of 502k compared to 897 at this point last year at a median sale price of 535k. 

Central Oregon has many great communities with price points to suit almost any buyer. Each community has its unique feel and attraction, with a relatively short drive to virtually any city in the area. Whether you want to explore Lookout Mountain in the Ochoco Mountains near Prineville, the Metolius River outside Sisters, Smith Rock in Terrebonne, the Phil's Trail Network in Bend, the trails and amenities of the Sunriver Resort, or fishing the Fall River in La Pine, everything is readily available. While Mt. Bachelor might be waiting for one more winter storm to open the lifts, our mild temperatures of late mean mountain biking, hiking, and even golf are still happening all across the region. Even the heavier snows at Mt. Bachelor leave Bend and the surrounding communities relatively unscathed during many storms, and most people find our winter seasons relatively mild compared to many ski-focused communities in the West. Enjoy our extended fall while you can; there is sure to be more winter headed our way before long!

I am actively exploring Central Oregon year-round and know our communities and the housing market thoroughly. If you are considering making this part of the world home, please reach out anytime with any questions. I am always happy to share my knowledge of the area!

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4 Essential Tips for Purchasing an Older Home in Bend Oregon

When it comes to Bend OR real estate, you'll find a treasure trove of older, historic homes that exude charm and character. While the allure of owning a piece of history is undeniable, it's crucial to approach the purchase of an older home with a discerning eye. In this article, we'll explore four valuable tips to consider when buying an older home in Bend, Oregon.

Evaluate Electrical and Plumbing Systems

Older homes often boast architectural beauty, but they may also come with outdated electrical and plumbing systems. Rewiring and updating plumbing can be costly and extensive endeavors. Many older homes in Bend, Oregon still have their original knob-and-tube wiring and cast-iron pipes, which pose safety risks. Outdated electrical systems can lead to fire hazards, while corroded pipes may cause leaks and water pressure problems.

Before committing to the purchase, inquire about the condition of the electrical and plumbing systems. If the original systems are still in place, obtain a quote for their replacement. Additionally, ask the sellers if any updates have been made and verify if they meet current building codes.

Address Hazardous Materials

Some older homes in Bend, Oregon may harbor hazardous materials, including lead and asbestos. Lead-based paint was commonly used on both interior and exterior surfaces until 1978, and lead exposure can lead to health issues. Asbestos, on the other hand, was utilized in various building materials until the 1970s when its health risks became evident.

Before finalizing the purchase, investigate the presence of lead paint and asbestos in the home. Assess the costs associated with their removal and remediation, especially if items like popcorn ceilings contain asbestos.

Examine Foundation and Structural Integrity

The passage of time can take its toll on even the sturdiest of homes, leading to foundation and structural issues. In older Bend, Oregon homes, you might encounter signs such as doors and windows that jam, wall cracks, or cracked tiles, all of which could indicate foundation problems. During your inspection, pay close attention to these potential red flags.

If the inspector uncovers significant concerns or necessary repairs, you have options. You can negotiate a lower purchase price, request that the seller completes the necessary repairs, or reconsider your decision to buy the home. Keep in mind that the cost of repairs could exceed your initial budget.

Ensure Safety with Smoke Alarms and Carbon Monoxide Detectors

In Bend, Oregon, like in many other states, smoke alarms and carbon monoxide detectors are mandatory on every level of a home. Safety should always be a top priority. Test these devices to ensure they are functioning correctly, as they play a crucial role in safeguarding your family and property.

While buying an older home in Bend, Oregon might not be suitable for everyone, there's an undeniable charm and nostalgia associated with these historic dwellings. Whether you're drawn to a Victorian-style gem or simply appreciate the unique character of older homes, following these tips will help you make an informed decision and ensure your new abode stands the test of time.

Search for Older Homes in Bend Built Before 1960

Happy Thanksgiving Eve! I wish you and your loved ones a wonderful day, however you choose to celebrate. The weather tomorrow is forecast to be colder than the recent pleasantly warm weather, but sunny skies are on tap for your outdoor adventures. Friday, Mt. Bachelor opens for the season, adding one more activity to the list of possibilities. Most trail systems are still in prime condition for mountain biking, hiking, or running, so the options are endless! 

This week, there are twenty-eight fewer listings in Deschutes County, now at 764. Fifty-one homes were pending at a median of 670k, with another 48 sold at the same median price. Consistent with the data over the last several weeks, 53.4% of the active listings have reduced the asking price by a median of -4.6%. The median list price-original list price ratio for the sold properties is 93.17%, indicating that sellers have come down nearly seven percent since listing their homes before finding a buyer. After analyzing the data, it is apparent that most price reductions are coming down from overly optimistic pricing for this year, not a collapse. The year-to-date median sale price has remained consistent at 660k. With 2,916 sales this year and approximately fifty sales per week, total sales for the year will break three-thousand, although likely less than the 3,197 of 2010. Deschutes County's population has increased by 30.7% since 2010, putting 2023's low sales volume in perspective. You also may recall that 2010 was just past the low point of the last housing crash.

Crook County inventory dropped by two, now at 144 active single-family listings, and remains remarkably stable over the last several weeks. Five homes are pending in the county at a median price change of -13.34%, more in favor of buyers than at any time in the last few years. The Prineville Market Trend Report illustrates this clearly. However, zero sales over the previous seven days in Crook County is an even stronger indication that buyers are gaining leverage. If you strip out the high-end sales from Brasada Ranch, the data looks even more favorable for Crook County buyers. 

In Jefferson County, inventory declined by six, now at seventy-eight active listings. The weekly activity was robust, with six pending sales and four closings, especially considering only two pending transactions last week and zero closings. With such a diverse inventory of homes in the county, a median sale price of 687k is unsurprising, but the pending median price was less than half that at 315k. Conditions in Madras are nearing a balanced market, although still slightly favoring sellers. The Market Trend Report for Madras shows the trend clearly.

The Market Trend Reports on my website are a fantastic resource, especially when the market is transitioning based on market factors or during seasonal changes. I have links to all the Central Oregon Zip Codes on my website (accessed from the top navigation bar or at the menu icon in the upper right corner). Use this link for the conglomerated data in a single report for the entire city of Bend. Registering to receive Market Trend Reports opens the ability to search for any zip code or city in the country to access city-specific data using the search bar at the top of each report.

This morning, the national average for a 30-year fixed-rate mortgage is 7.33%, a significant drop from recent highs. Despite recent optimism, reading the narrative following the last Federal Reserve Open Market Committee meeting shows no sign of backing off the "higher, longer" narrative. However, the recent reprieve in interest rates and our seasonal slowdown have created buyer opportunities. As the inventory of available homes dwindles, our market is constantly sorted, with many homes that have lingered on the market suddenly looking strong in comparison. Most homes on the market for an extended time have also reduced the asking price. The combination creates activity as buyers "clean up" before year-end. With fewer new listings at this time of year and most highly marketable properties listed in the spring, buyers recognize that great deals are available today. Missing out could mean waiting for months before suitable inventory is back on the market. 

Buyers at this time of year generally have a little breathing room with offers. However, complacency could mean losing a desirable property. Especially with the recent drop in interest rates, staying in contact with your lender and being poised to make an offer is essential. Many sellers of higher-priced homes in our market require proof of funds or a pre-approval for showings. A screenshot of sufficient funds to close is all it takes for cash buyers, which generally isn't time-consuming. A pre-approval can take more time and resources if you finance your purchase. As the economy has tightened, so have the requirements lenders ask of buyers, which vary based on your financial situation. A salaried employee will have significantly less paperwork to gather than a self-employed entrepreneur or someone with several sources of income. No matter your situation, I have a team of local lenders I work with, and I can point you in the right direction. Of course, a pre-approval from a lender you already have a relationship with also works. Pre-approval is more than simply being prepared to make an offer; it sets the tone for a relationship with a seller. Everything we do from the moment I call to schedule a showing is evaluated by a seller and listing agent. Presenting you in the best light possible to secure a contract is one of many jobs I have in helping you find the perfect home!

Where interest rates and the housing market go from here is a mystery. But, I am always current on the Central Oregon data and broader financial markets. Please reach out if you are looking for specific data or want to discuss market trends. Everyone's situation is unique, and I am always interested in hearing your perspective.

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If you are a homeowner, you likely have home equity that can unlock the potential for new investments. Your current equity can be leveraged to fund your new real estate goals, like buying a second home. For those considering such a move, Central Oregon emerges as an enticing destination, offering a blend of natural beauty, recreational opportunities, and a burgeoning real estate market.

Whether you already live in the area, or you want to learn more about homes for sale in Central Oregon, we are here to help. Contact us any time to learn more about houses for sale in Bend or nearby communities, and keep reading to learn more about how to strategically leverage your home equity to invest in more real estate.

Understanding Home Equity

Home equity is the difference between the current market value of your home and the outstanding mortgage balance. Before leveraging it for a second home, it's essential to have a clear understanding of your home's current value and your existing mortgage.

We can help by assessing the current market value of your home if you already live in the area. Contact us any time to get a free market analysis of your property.

Financing Options

Once you know how much equity you likely have in your home, you can move on to learn more about how you can leverage it. Lenders typically consider the loan-to-value (LTV) ratio when assessing the risk of providing a home equity loan or line of credit. The LTV is calculated by dividing the total loan amount by the appraised value of the property. Generally, lenders prefer an LTV ratio of 80% or lower.

There are various financing options for leveraging home equity, including home equity loans, home equity lines of credit (HELOCs), and cash-out refinancing. Each option has its pros and cons, and the choice depends on individual financial goals and circumstances. We always recommend starting by talking with a lender about your options, and we can recommend some lenders we trust if you need a connection.

Considering Holistic Affordability

The affordability of your second home will depend on far more than just how much you invest initially. As you consider how to leverage your home equity, keep in mind that you may want some of the equity kept liquid as a way to fund renovations, furnishing, or even just to have an emergency fund on hand.

It's essential to calculate the affordability of a second home, factoring in the additional costs such as property taxes, insurance, maintenance, and potential fluctuations in interest rates. Understanding the financial commitment involved ensures a more realistic and sustainable investment. Central Oregon features a variety of great places to invest, with a wide range of price points and styles of homes so that we can help you find the second home that fits your ideal budget.

If your intention is to rent out the second home when not in use, consider the potential rental income as part of the holistic affordability of the property. Central Oregon's popularity as a tourist destination makes it a viable location for short-term rentals, providing an additional income stream that can offset costs. Even if you only do this temporarily, it can offset the investment and possibly even make it net profitable.

Ready to learn more about finding your second home in Central Oregon? Contact us any time.