New density rules open divisions in single family neighborhoods

            UPDATE: As of February 18 Bend city planners say there is no longer an active application for development of the Compass Corner site. More details in the future.

          Proposed projects at different points on Bend’s Awbrey Butte are focusing a debate over affordable housing, the impacts of high density and multi-family units in traditional single family neighborhoods--and related new city development code provisions.
            Comments by residents regarding proposals by separate developers for the West View project on Glassow Drive on the west side of the butte and Compass Corner on the northeast side both emphasize that the scale and traffic impacts would be detrimental to existing neighborhoods.
            However, both proposed projects appear to fit an emerging city strategy to encourage more multi-family and higher density housing in neighborhoods otherwise zoned RS, for standard single family homes.
            Latest versions of the city code follow Oregon’s new statute, House Bill 2001, intended to force higher density in single family neighborhoods, with the objective of easing the crunch of escalating housing costs beyond affordability levels for many families.
            Among new code provisions is the potential to build up to a quadraplex on a lot of at least 4,000 square feet in a typical neighborhood of single family homes. The code would also downsize current requirements for off street parking.
            As the provisions take effect, homeowners in some neighborhoods have begun to review requirements in their covenants, conditions, and restrictions, or CCRs, that stipulate what type of housing can be built. In theory, CCRs restricting construction to only a single family home would supersede the city code, but legal action might be required to enforce the CCRs.
            One of the two Awbrey Butte projects gaining much attention is Compass Corner, proposed as a mixed use development for as many as 63 studio, 1 and 2 bedroom apartments, up to four floors including retail space. Parking would be above and below ground on the 1.02 acre site overlooking Mt. Washington Boulevard and bordered by Awbrey Road

Compass Corner concept plan

NW.
            County records show the site is owned by Hotel Management LLC, with a registered agent at the same address as that for owners of the recently opened My Space hotel off Bond Street above the Old Mill District. The registered agent is Sueng Lee, at the same address, while LLC members and addresses on the Oregon business registry include Michael Chun of Bend; Anthony Kim of Federal Way, WA; and Shilla Yi of Tacoma, WA.
             In a January online presentation, representatives of the development team fielded comments from area residents who complained the several story buildings were out of scale for the neighborhood, would create traffic hazards and result in parking spilling onto narrow streets.
            Some commented online that neighbors should hire an attorney to oppose the project, as was done by owners in the Rivers Edge community who appear to have prevented the golf course there from being developed for housing. (links to Rivers Edge

Homeowners play a good round at Rivers Edge course

Trading golf for homes: Rivers Edge proposal raises future housng issues

             The project vision appears to have expanded considerably since the city posted a “pre-application meeting summary” of the proposal in February of 2021. That document noted a project to include 35,000 square feet of apartments and 5,000 square feet commercial, up to four stories with surface parking.
            Now in the proposal under consideration by the city as of November 2021, Compass Corner would include 63 apartments in two buildings with up to 10,000 square feet of commercial space. The two buildings would total more than 57,000 square feet along with underground and surface parking. 
             A little over two miles on the other side of Awbrey Butte some neighbors are mobilizing with yard signs to oppose the 6.5 acre West Hill Development that would include 42 units of townhomes, duplexes, triplexes, and quadraplexes on 29 lots. It could also result in removal of more than 700 trees.

West Hill on Glassow overview

            In a guest column in the Bend Bulletin, one resident wrote that,” The objection is not over development per se...The concern is over the scale of the project and the lack of fit with the surrounding neighborhoods, physical environment and supporting infrastructure.”
            Taking a stance more favorable to the project, another writer responding in a column that,  “To complain about housing in your neighborhood (and mine) that does basically the same things that the building of your home did is peak entitlement. Being against the development because it doesn’t exactly mirror what is currently there, despite the law allowing such development, only compounds the cost of building and the shortage of housing.”
            Principals of the West View project are members of Oregon Builders Developers LLC Glenn Kotara and Mark Huffman, both who have Bend mailing addresses.
            By mid-January of 2021, neither Compass Corner nor West View had come before the city planning commission for review, which would be a step before going to the Bend city council.
            With Compass Corner a conditional use permit allowing an exception to maximum size on the site would be required. And it’s possible the issues swirling around both projects could result in both being considered by a hearing officer after public sessions.
            Although not yet in the development planning stage, another site in the same Awbrey Butte area of Compass Corner could also become part of the density discussion.
            At the northeast corner of NW Sonora and Awbrey Road are two lots, one of  0.20 acre and another of 0.14 acre which were listed in January, and became pending sales in 24 days,  as potential sites for duplexes on each property. The site is at the southern intersection of the neighborhood served by streets linking to Compass Corner and abuts an often busy roundabout at a sloped point on Awbrey Road.

Looking back and ahead: Will home prices slow?

             Welcome to 2022. And maybe fasten your seatbelt.
            Inflation and CPI up, but GDP also up, interest rates on the rise – maybe with several Fed Reserve moves, midterm elections on the horizon and Covid still hanging around.
            What could go wrong with this bubbling stew of issues?
            And how does this all affect the macro and micro view of real estate, including down to ground level here in Bend and Central Oregon?
            First, let’s take a look at how 2021 rolled to an end, with a focus on Bend as the largest submarket segment in the region.
            As compiled for the Beacon Report by Beacon Appraisal, 2021 sales of single family homes on less than an acre in the greater Bend submarket totaled 2,480, down 3.61% from the comparable 12 months of 2020. Beacon’s numbers are based on data from the MLS of Central Oregon.
            Median prices for homes on less than an acre sold at a median price of $675,000 in December. On a rolling 12 months the median price was $642,500, or 30% more than the $496,000 in the comparable period of 2020.
            The largest number of sales, 45% or 1,107 homes, were in the $450,000 to $650,000 range, while only 51 homes sold at less than $400,000 and 176 under $450,000.
            A continuing trend has been the upward movement of sales at $1 million or more, with 405 in that range during 2021.
            Another repeated metric in the Bend market is tight inventory of only 74 homes for sale at year-end, which translates to only a 0.40 month supply based on the average of the past 12 monthly sales.
            In Redmond, the region’s second largest submarket, 2021 sales totaled 1,071, a slight increase over the 1,056 sales in 2020. The 30 homes on the market as of year-end mirrored Bend’s inventory of only 0.40 monts.

Redmond prices up 27%

            Redmond’s median price for December 2021 was $375,000 with the median for the rolling 12 months at $446,500, 27% higher than $351,000 for the same period of 2020.
More than 56% of sales, or 605 homes, were in the $300,000 to $400,000 range, evidence that Redmond continues to be a more affordable choice in the top two regional submarkets.
            Across the other five small submarkets single family homes sold on under an acre totaled 1,121 in 2021, with most sales, in Crook County (incoluding Prineville) at 340 sales and the next highest number, 230, in  in the Jefferson County (Madras) and Crooked River Ranch combined.
            Inventory in those areas ranged from lows of only 0.25 months supply in Sisters and Sunriver at year-end to three months in LaPine.

            The Beacon Report only tabulates quarterly median sales for the smaller submarkets. The most expensive submarkets were Sunriver and Sisters.  Monthly sales over the four quarters ranged upward each quarter from $794,000 to $865,000 in Sunriver and, in Sisters, from $479,000 to $645,000.  Of the other areas, LaPine prices were highest at $391,000 for the 4^th Quarter.
            As for where to in 2022, it’s doubtful that there will be a major influx of homes coming to market to move inventory from the current sellers market to a level of 4 to 6 months that signal a more balanced “normal” market.
            The uncertainty over interest rates, with the Federal Reserve signaling perhaps several rate increases, could dampen demand. And if Covid reaches a peak, begins to decline substantially and there are no severe new variants the rush to resettle out of major urban areas could taper.
            Moreover, though, as the customary mantra goes, Bend and Central Oregon will continue to be attractive for lifestyle values, retirement amenities and as a haven for remote working.
            Whether prices can continue to rise at rates of 25% to 30% annually could be the most important question for 2022. It’s doubtful.