Bend newcomers Rachel and Garrett Ahlberg began looking for a house over the summer, made an offer on one and expect to close the sale later this month.
It was a straightforward, simple process, Rachel Ahlberg said. “How the market is looking right now is definitely not how it looked a year ago. It’s not as much of a seller’s market.”
Ahlberg, a first-time home buyer, said she and her husband looked at about half a dozen houses in their price range, which was below $450,000, before making an offer at full price.
“Didn’t expect to be able to lowball anything, necessarily,” she said. “Just not expecting a multiple-offer situation.”
Demand for homes typically slackens in autumn, but there are signs of sustained relief from the high-pressure environment that buyers have endured the past few years.
“What you’re seeing nationally and also in Bend is a little softening of the market,” said Megan Power, a broker with Coldwell Banker Morris Real Estate. Interest rates have risen, she noted, and buyers are savvy. “Even though we are much less expensive than the (San Francisco) Bay area, or Portland or Seattle, people are not going to overpay for a house just because it’s on the west side.”
The median sale price of a single-family home in Bend reached a new high of $449,000 in June but then fell in each of the following months, which are peak season for closing transactions, according to Beacon Appraisal Group in Redmond. The median price in September was $425,000, which is 0.17 percent above the median price for September 2017, $418,000.
Price reductions are also becoming more common for single-family homes in Bend. The average number of list-price reductions jumped 18 percent, from 706 per quarter in 2017 to 833 per quarter through the third quarter this year, according to Central Oregon Association of Realtors data. Price drops, which can occur multiple times for one listing, also became more frequent compared with the number of homes for sale. So far this year, there have been 2,499 price reductions, or 83 percent of the 2,999 listings. Last year, there were 2,825 reductions, or 76.6 percent of 3,690 listings.
The reductions are small. The median ratio of sales price to list price was 98 percent in the third quarter, the Realtors data shows.
Like Portland, Bend is still a seller’s market, said Tim Duy, professor of practice in economics at the University of Oregon and author of the Central Oregon Business Index. Bend had a three-month inventory of single-family homes for sale in September, according to Beacon Appraisal Group. Real estate brokers consider a six-month supply of listings to be a balanced market.
“There’s no major earthquake in this market,” Duy said. “It’s more to the effect of the price gains have been going on a long time, people got aggressive with pricing, interest rates got kicked up a little bit, there was some pushback from buyers.”
Buyers are turning to Redmond and La Pine, where prices are lower but rising faster than in Bend, Duy said. The median sale price of a single-family home in Redmond marched upward since April to $310,000 in September, according to the Beacon Report. That’s 8 percent higher than in September 2017.
Rob Marken, owner and broker at Bend River Realty, said higher mortgage interest rates are having a big impact on buyers’ budgets. The average rate on a 30-year, fixed-term loan this month reached 4.9 percent, the highest level in seven years, according to Freddie Mac’s weekly survey. Back in January, rates on a 30-year loan averaged 4.04 percent.
“So if people overprice their home, the market can’t absorb it,” Marken said. That’s made price reductions more common, he said.
Alleda Real Estate broker Fran McCormick said that’s not been her experience. All the buyers she represented this year made offers at asking price, she said. “They were in competition for houses.”
One of her listings, a home on an acre of land south of Bend, was marked down recently by $5,000 to $382,900, McCormick said. She said price reductions are to be expected for houses listed after the school year begins in September. Relocating families are a big segment of the market, and most aren’t willing to move after school starts, she said.
The house on Mohawk Road was built in 1998 and competes with new construction in the same price range, McCormick said. “This is not a shiny new house,” she said. “Looking at the market, it’ll probably go down again.”
— Reporter: 541-617-7860, firstname.lastname@example.org