A quick view of single family home
sales in Central Oregon’s two largest sub-markets, Bend and Redmond, shows some
slight upward tick in available inventory and a continued rise in prices.
The new statistics were compiled for the Beacon Report by Beacon
Appraisal Group, drawing on results from the MLS of Central Oregon
database.
In the rolling 12 months through the end of September
of 2021, the median price of single family homes on less than an acre in Bend
was $609,000. On a single month basis
the median price crossed the $600,000 level for the first time in April, to $651,000, a
dramatic jump from $590,000 in March.
After that, the price dropped to $628,000 in May, before
recording an irregular line on the appreciation chart that shows an increase
back to $650,000 in July, then a drop to $635,000 in August and back to
$650,000 in September.
Comparing the previous 12 month
period of 2020, prices rose 32% from $460,000 at the end of September last year
to $609,000 at the end of September 2021.
Inventory, as calculated by
averaging the previous 12 month sales in relation to currently active listings,
at the close of September was only on month. Altogether there were 2,555 sales
during the 12 months, with 232 active listings at month’s end.
Although the inventory represents an
improvement over a low of only 0.3 months during the past 12 months it nevertheless
falls short of the 5 to 6 months usually considered to be a balanced buyer-seller
market.
More than 50%, or 1,298, of the past
12 months Bend sales of 2,555 were in the $400,000 to $650,000 range. In the 12
months through September 2020 there were 1,100 sales, or 44% of 2,489 sales in that range.
The more dramatic shift year to year
for the 12 month period occurred in the $300,000 to $400,000 range. Sales in that
lower range dropped from 674 to 136.
As
another marker of upward pricing in the Bend submarket, there were 367 sales,
or 14.3%, at more than $1 million in the 12 month period, compared with 191, or
7.6%, of the 2,489 in the same 12 months ending in September of 2020.
In Redmond, the 12 month median
price rose 27% from $326,000 at the end of September 2020 to $412,500 the same
period ending this September.
Redmond prices crossed the $400,000
monthly mark in March and hit a high of $451,000 in June, before dipping to
$436,000 in July and rising back to $450,000 in August and September.
Redmond’s inventory was also
approximately one month at the end of September, based on 12 month sales of
1119 and 97 active listings.
Although anecdotal, experienced
brokers sense a change in the Bend market, as aggressive seller pricing has
resulted in downward listing adjustments on many properties.
One issue could be a seasonal cycle
that typically reflects the end of the usual summer vacation months, together with colder
weather on the horizon and children back in school.
Bend sales in September this year
dropped to 232 from 248 the same month of 2020. There
were 104 sales in Redmond in September 2020, against 88 this year.
On the national level, one significant
industry group is warning of potential substantial downward changes in the
housing market in coming years.
A survey by Wakefield Research reported
in the second week of October shows that 78% of community bank executives
expect the housing market, “will ‘crash’ in the next five years," according to
digital news site Axios.
Another cautionary issue comes as economists
keep a close eye on the Producer Price Index (PPI) in relation to the Consumer
Price Index (CPI). Substantial increases in fuel prices and distribution
bottlenecks in the supply chain are both resulting in upward inflationary
trends on many durable and household goods.
There’s speculation the Federal Reserve,
which for years has followed a “quantitative easing” strategy to prime the economic
pump, may be forced to bump up interest
rates to staunch inflation. That in turn could bode ill for many sectors,
including the housing market.
