Foreclosures on decline but still a factor

            Foreclosures and short sales that  ripped through the regional real estate market with the deepening recession have declined dramatically as a percentage of total home sales.

`           In 2010, the peak for distressed sales, foreclosures and short sales accounted for 56.73% of the 1,553 single family homes sold in the greater Bend area, which is by far the largest sub-market  in Central Oregon.

            As the housing crash began in 2008, only 7.35% of Bend area sales were in the distressed category. But in 2009 the number accelerated to 54.94% of total sales and continued above 50% until beginning to decline in 2012 when 726, or 18.17%, out of 1,902 single family homes sold were in the distressed category.

            In 2012 through late October the total of single family homes sold has already reached 2,122, with only 247, or 11.59% of those either short sales or foreclosures.

            Although seen as a positive trend, the decline in distressed sales could also be partially the result of a new state law that caused some lenders to pull back from issuing notices of default for a time.

The law was intended to encourage lenders to sit down, and ideally negotiate, with delinquent homeowners. But the voluntary nature of the statute resulted in many lenders turning from the nonjudicial path to the courts through the judicial foreclosure process, both of which are allowed in Oregon.

With a recent “fix” by the legislature, lenders are now required to negotiate with homeowners in either foreclosure method.

When most lenders were opting for nonjudicial foreclosures the process would typically take about six months from the filing of a notice of default with the intent to proceed to trustee’s sale after that period.

            In 2007, before the housing storm hit, there were only 591 notices of default recorded in all of Deschutes County. That tripled to 1,930 in 2008 and rose to 3,507 in 2009 and a high of 3,762 in 2010 before tapering off to 2,363 in 2011.

            For 2012 default notices dropped to only 797 before rising again this year  when 858 were filed through late October.

            Even with single family sales in the Bend sub-market through 10 months of 2013 more than double all of 2008 there’s still the possibility that more distressed sales are in the “shadows.”

            However, there is considerable new housing construction at the lower to lower middle market and financing is available to qualified buyers. Inventory as measured by annualized previous month-to-month sales is also low at less than 4 months.

As such, new distressed sales coming onto the market would possibly be absorbed by continued steady, barring continued dysfunction in Congress or the Federal Reserve making an abrupt about face by driving up interest rates.

           

             

Indian Summer ends with windy, snowy flourish

            So much for that earlier post of only a few days ago bragging about Bend’s string of extraordinarily  balmy Fall days.

            From the 60s on Friday, Oct. 25, Saturday morning emerged cool with blue skies before a fast moving cold front brought rain in town and snow in the high country.

            Then by Monday morning came a dusting of snow with temperatures hovering in the 30s at midday.

            The result is that inflection point among outdoor enthusiasts, with snow sports types wishing for more of the white stuff and others hoping to squeeze in another warm day fly fishing or mountain biking. 

Bend in Brief - Fall 2013

Surviving then Thriving

            At the depths of the real estate collapse Bend-based Cascade Bancorp., parent of regional Bank of the Cascades, was among many banks on federal regulators’ watch list and required an infusion of investor capital.

            But the bank now appears to have turned the corner, recently reporting positive quarterly earnings and in mid-October announcing the planned purchase of Idaho based Home Federal Bancorp.

            Cascade Bancorp will reported pay $265 million for Home Federal, Idaho’s largest bank, based in Nampa east of Boise. The bank has seven branches in Central Oregon, including four in Bend, and eight others elsewhere in Oregon as well as 11 in Idaho.

            Altogether the acquisition would give Bank of the Cascades 57 branches in Oregon and Idaho.

Tourism numbers continue a steady climb

            As indicated by lodging tax returns, Bend tourism and conference business continues on a upward path after hitting a low point in Fiscal Year 2008-09.

            For the fiscal year ending June 30 “transient room tax collections” of $3,888,069  were 10.34% above the comparable period of July through June 2012-13, and 32.5% higher thatn 2008-09.

            Looking at the lodging tax statistics for each of the past five fiscal years,

receipts increased every month year to year except for October and December of FY 2011-12 and July of FY 2012-13.

            For the past fiscal year in Bend, July had the largest tax receipts of $543,438 and November the lowest at $178,469. The largest month to month increase was in May, which rose 17.69% over the same month of FY 2011-12.

Low flow in Mirror Pond brings issues to surface

            Open most tourism publications or web sites featuring Bend and there’s a good chance you’ll discover a photo of Mirror Pond and Drake Park--often with canoeists or kayakers and the Cascades in the distance. (take a look at the opening photo of this blog).

            In recent years the there’s been a longstanding discussion (controversy? debate?) of how to address continuing silt build-up that could eventually turn this slackwater “pond” on the Deschutes River into a wetland.

            Special committees have been formed. editorials written, polls taken.  But by Fall of 2013 there’s been no firm direction as to whether to dredge again to keep the pond, create a more free flowing stream or some combination that would create a shoreline wetland.

            Another factor has been the small Pacific Power hydroelectric dam just north of the Newport Avenue bridge. The big utility concedes the power output is minimal but has not indicated if it will remove the dam, although the company is meeting with local officials.

 Complicating matters this Fall there has been a major leak that resulted in offering Bend a muddy view of what Mirror Pond would look like without the dam.  The only agreement by everyone seems to be less talk and more action.

           

COCC to build dorm on campus site

            Much of the buzz about Oregon State University’s transition to a full 4-year OSU-Cascades branch on a planned 56 acre site has overshadowed it’s current facility partner Central Oregon Community College.

            Now COCC has announced plans for a new 330-room,  dorm that would be built in a three-wind terraced configuration on the college’s current southwest corner along Mt. Washington Drive.
            The college has chosen a construction manager-general contractor approach to better define final costs, estimated to be in the range of $16-$16.4 million. The dorm is expected to be ready for occupancy of the 10 communities of 33 students each by the summer of 2015.

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Break out the cigars...it's a campus!

 

Fall 2013 - Bend weather lives up to its reputation

            Bend often gathers kudos for a reported annual 300 days of sunshine, little snow in town but much only 20 miles away at Mt. Bachelor and Spring days when you can ski in the morning and get in a round of golf before dark.

            The Fall of 2013 has brought the usual spectacular colors from turning aspen, alder, maple and other native and ornamental trees. But the weather has also been remarkable with crisp mornings in the 30s that call for a warm fleece and afternoons in the 60s, even 70s, that beg for shorts and T-shirts.

            The graphic below from a recent National Weather Service forecast says it all. Get out and enjoy the weather.

Break out the cigars...it's a campus!

            If all goes as now planned approximately 56 acres bordered by Mt. Washington Drive and Chandler Avenue on Bend’s west side will be the site of a new campus for the emerging 4-Year OSU-Cascades college.

            The preferred site, just west of the gated Broken Top golf community, was

announced by OSU officials Sept. 13. But many who had followed the process had considered it an obvious choice as one of the largest parcels within the city limits.

            Early reports some weeks ago indicated the adjacent former landfill owned by Deschutes County might be under consideration.  But two parcels, one approximately 46 acres and the other 10 acres, just south of the county site are now leading the way on a fast track to have new facilities ready for the 2015-2016 academic year.

            Plans call for 146,000 square feet of facilities by then, which would include both classroom and onsite living quarters for students.

The proposed site of the new OSU-Cascades campus

            Depending on results of OSU’s due diligence period, which runs six months with a possible 60-day extension, the university has agreed to pay a total of nearly $13 million for the two parcels.

            The legislature appropriated $16 million in bond funding in the last session that ended in July. This would be added to $4 million from the university budget and another $4 million raised within Central Oregon.

            OSU and its consulting engineering and environmental specialists have begun their Level 1 assessment of the smaller parcel. Recent reports in local media say there was some evidence of “non-native” material that could have migrated from the adjacent Deschutes County property, once used for demolition, construction, industrial and other problem waste.

            However, OSU officials were quoted as saying that a lot line adjustment could be considered to remedy portions of the site that might have material that moved from the county property. In the long-term, an OSU official said, the county site could be an expansion possibility for the campus.

            Apparently never under serious consideration as a potential campus site was the 1,500 acre Juniper Ridge project owned by the City of Bend, which recieved the land as a gift from Deschutes County.

            The city had intitially said it would like to see research companies and a major education facility on the property. But the region’s severe real estate downturn, transportation access and a dispute with consulting developers over the project’s master plan have plagued the project.

Housing: nearing the $1billion mark again in 2013

            For the second year in a row the regional residential real estate market is on track to break  the $1 billion sales volume threshold.

            Sales of single family homes totaled $956,753,029 through the third quarter, according to preliminary figures from the Multiple Listing Service of Central Oregon, a pace that will surpass 2012 sales of $1,005,488,048.

            But the past two years would remain below the volume of the bubble years, when there were sales of $1,939,113,490 in 2005; $1,835,737,987 in 2006 and $1,246,025,261 in 2007.

            Then came the implosion of 2008, when volume plummeted to $791,699,547 and remained in a more narrow $25 million range for 2009 through 2011 three years until cracking $1 billion again in 2012.

            By any measure the Central Oregon housing market, led by the greater Bend area with more than two-thirds of 2013 volume thus far, is continuing a recovery from one of the most precipitous declines in the nation during the past recession.

            But homeowners, developers, builders, brokers, craftsmen, retailers--among others-- are holding their breath as the prolonged debacle in Congress and slowly escalating interest rates threaten to impede a fragile economic recovery.

            Looking at the past years and 9 months through September of 2013 (chart below):

·        The number of homes sold has increased in all regional sub-markets except Crook County, which declined 4%.

·        Median prices increased across the board, in a range of 4% in Sunriver to 38% in LaPine.

·        Bend lead in the number of sales with 44% more closings--1,933-- than all other sub-markets combined.

·        Inventory, as defined by an average of the previous 12 months sales, was lowest in Bend, at 3.10 months supply. Sunriver had the highest inventory at 9.60 months.

·        Cumulative Days on Market (CDOM) decreased in all submarkets, with the largest drop in Bend of 25%, from 105 to 79.

           Follow the blog for updates on other market categories as we enter the final quarter of the year. For previous market updates, go to Market trends .