Bend sees more million dollar sales - as affordable housing needs grow

             As the conversation over affordable Bend housing continues, home prices are also escalating at a rate that may outpace any near term solutions.
            Data compiled by Beacon Appraisal Group for its monthly market report shows that the median price of a Bend single family home on less than an acre was $640,000, the third consecutive month above $600,000 although below the high monthly median of $651,00 in April.
            Perhaps more remarkable are the sales of homes at more than $1 million. There were 341 homes closed at $1 million or more for the 12 months through June of 2021, a 158% increase of the comparable midway point of 2020.
            The trajectory of the million dollar sales has more than quintupled the 67 at that range recorded in just the three years since midway 2018.
            As a percentage of all sales, those of $1 million or more accounted for only 2.6% in 2018, then rose to 4.7% in 2019; and 5.7% in 2020 before leaping to 12.3% for the 12 months ending June 20, 2021.
          Although the upward arc of regional housing sales has yet to show any weakening, it’s instructive to balance single month prices over a 12-month stretch.
            By that measure, Bend’s median single price for homes on less than an acre over the 12-months from July of 2020 through June of 2021 was $567,000, a jump of 23% over the $460,000 recorded for the comparable 2019 through 2020 period.
            The median price for the same quarter of the two years shows a greater increase, from $464,000 for the three month median in 2020 against $640,000 in 2021 – a 38% increase.

            To the north in Redmond, the region’s second largest housing market, the June median price was $451,000. For the 12 months the median was $374,000, 14% above the same 12 months of 2020. The quarter to quarter price of 2020 and 2021 rose 33% from $334,000 for the 2^nd quarter of 2020 to $443,000 in 2021.
            With Bend homes going into sales contract in last than a week on the market in the past several months, and often closing above listing price, the path for more substantial affordable workforce housing in the city is difficult.
            Bend is not unlike other smaller to mid-sized municipalities, many in the West, where attractive outdoor recreational opportunities combine with other lifestyle amenities to change the character of those once included in the “last best place” category.
            There are few undiscovered western gems left, with such towns as Whitefish, Bozeman and Livingston, MT and Prescott and Flagstaff, AZ and even Washington’s more remote Methow Valley straining under an influx of new part and fulltime residents.
            One possibility for more dedicated affordable housing lies in the distant horizon after approval of special legislation that would allow Bend to bring 260 acres of land bordering the southeast limits into its urban growth boundary.
            In theory House Bill 3318, which makes an exception to usual state land use procedures, could add land for as many as 800 affordable housing units on 20 of the 260 acres, with a 50-year deed restriction. It would also restrict 12 of the acres to anyone making 60% of the area’s median income, among other provisions.
            Also in the early stages of development in southeast Bend is what is known as the Stevens Road tract, 375 acres now held by Lands Bend Corp., a development group with several local projects whose principals include former California Republican Congressman Gary Miller.
            Lands Bend acquired the property from the Oregon Department of State Land for $22 million in the Spring of 2020. That acreage already lies within Bend’s urban growth boundary.
            The Bend Planning Commission is reviewing the company’s preliminary master plan that would provide for more than 1,700 housing units, about 650 of those single family homes, 359 townhomes and approximately 700 multi-family units.

Bend’s affordability challenge

            In a July report the Bend City Council announced the city had a total of 3,942 new housing either completed, under construction or in planning review in the period 2019-2021, which the report said exceeded a council goal of 3,000 units.
            The number included 1.976 finished units, 1,406 under construction and 560 being reviewed.
            The numbers appeared to give city leaders some encouragement in the continuing housing crunch. But another study by the city unveiled at a recent public online webinar shows affordability remains a major issue in relation to local median income.
            US Census data for the period 2015-2019 shows Bend's median household income at $65,662.
            On July 22, city officials held an information webinar to explain how the city plans comply with new Oregon legislation, HB 2001, which mandates that municipalities provide for multi-family units such as apartments, condominiums and townhomes be allowed in areas zoned for single family homes.
            A chart presented in the webinar shows that a household earning an adjusted median income of $120,600 could in theory afford a home priced at the maximum $566,980. That would leave the buyer short by $84,020 to purchase the median priced home that solid in April, according to Beacon Appraisal’s statistics as drawn from the MLS of Central Oregon.
            It would take an income of $64,300 to buy a home priced at a maximum $299,000, as noted in the city’s affordability chart. It would be a longshot if someone were fortunate enough to find one of the only 72 homes that closed at less than $300,000 out of 2,755 total sales for the 12 months that ended in April.
            And there were no closings at less than $300,000 in April.