Amid another record sales figure, buyers are pushing back

Median sales figure graphThe median sales price of a home in Bend, Oregon, set another record in July, the second month in a row that figure has reached unprecedented levels. But along with the rising median sales price came evidence that the market is highly competitive and buyers are pushing back on overpriced homes.

July’s median sales price was $412,500. That’s $3,500 (0.9 percent) more than June’s median price. June and July are the only two months out of the more than 10 years for which the Skjersaa Group has data that Bend’s median sales price has exceeded $400,000.

Compared with the median sales price of July 2016, this July’s figure rose 13.2 percent. The year-over-year increase in June was 10.5 percent – meaning that July’s sales prices showed a greater annual increase than June’s.

But there are signs that sellers need to get ahead of the game and price their homes competitively.

The average days on the market in July was 141 days, compared with 91 days in June. The 141 days is the highest for any July since 2012, which is the only year since 2010 that a July has had a higher days-on-market figure than this year. Put another way: July 2017’s days on the market are the second-highest for any July in the last eight years.

Looking at it another way, consider that the highest figure for average days on the market in any month in 2016 was 142 days – and that came in February, a typically slow month for home sales.

Inventory of homes matches high for 2017

And the inventory – the number of months it would take to sell all homes currently on the market given the current pace of sales – rose in July to 3.7 months, matching the highest month of this calendar year (January) and last exceeded in February 2016, when there was 4.9 months of inventory.

Our data is broken down by various price ranges, and as is usual with our monthly sales figures, not every price range tells the same story.

The inventory of homes priced at $625,000 and less is at most three months. Homes priced at more than $625,000 are driving a big part of the overall inventory figure.

Sellers reduce prices on sizable fraction of homes

Accompanying the record for median sales price figures these last two months is another noteworthy — and perhaps counterintuitive — statistic: the percentage of homes on the market with price reductions.

That number was 43 percent in June and 40 percent in July. We have to go back to February 2009 — before the housing market rebounded — to find a month in which 40 percent of the homes for sale had a price reduction.

There were 570 active listings in July. That’s the highest amount since August 2015 (583 active listings). And on Aug. 1, 2017, there were 638 active listings, the most since there were 638 in October 2014.

The sales data these past couple of months are open to various interpretations. Wherever you are in the real estate cycle — buying a home or thinking of selling — I can help you. My integrity, ethics and experience will ensure you of an optimal outcome. To learn more about how I can assist you in your real estate transaction, contact me at (541) 383-1426, or visit Bend Property Search to connect with me through my website.

Related Posts

  • 92
    By Jason Boone Although the median sales price of a home in Bend, Oregon, dropped in July for the second month in a row, there are plenty of signs that the trajectory of the market has only slightly leveled off and hasn’t begun anything approaching a downward path. July’s median…
    Tags: market, july, price, sales, median, months, percent, $, inventory, homes
  • 90
    The housing market in Bend, Oregon, tapered slightly in May, as the median sales price fell for the second month in succession and the inventory of homes on the market rose compared with April. Still, the year-to-date median price remained steady at a price that represents a high for the…
    Tags: median, price, $, sales, percent, homes, months, inventory, market, month
  • 86
    By Jason Boone In my review of May’s home sales data in Bend, Oregon, I suggested that the market might have been reaching a peak. The figures for the three months since seem to support that theory. The median sales price of a home in August was $359,000. That represents the…
    Tags: price, sales, market, median, months, percent, $, homes, inventory, month
  • 83
    By Jason Boone The median price of homes sold in Bend, Oregon, in May was the second-highest in the last 10 years, but there are signs that prices might be nearing or at a peak. At $374,000, the median sales price in May 2016 trailed only that of May 2007…
    Tags: price, homes, sales, market, median, month, months, $, days, inventory
  • 80
    By Jason Boone The number of homes sold dropped and the median home-sale price in Bend, Oregon, fell in October, copying a trend from the previous October. The year-to-date median sales price continued to rise last month -- as it has done each month in 2016 -- adding a very…
    Tags: market, sales, price, $, month, homes, median, inventory

ARM vs. fixed-rate loan: Which is right for you?

Even though interest rates for traditional 30-year mortgages are near the lowest on record, some home buyers in Bend, Oregon, take on adjustable-rate mortgages, or ARMs. These loans start, for a predetermined time, with an interest rate even lower than that of a traditional 30-year loan, after which the rate adjusts – and payments can increase dramatically.

Are there advantages to ARMs? And if so, who can benefit from them?

The obvious benefit of an adjustable-rate mortgage is the money saved during the initial, fixed-interest rate period. A few years ago, The Motley Fool ran the numbers on a $200,000 home and said the difference in lower payments and greater equity after five years – just before the interest rate would adjust – would be $8,450 compared with a fixed-rate loan.

Adjustable-rate loans can work for short-term owners

The example from The Motley Fool highlights one type of home buyer who can benefit from an ARM. “For people who know they probably won’t remain in their homes beyond a five-year period as the result of personal, work, or family situations, an ARM could make a lot of sense,” the article notes.

Even if an owner will be in a home after the interest rate in an ARM changes, there is a window of time in which an ARM will have required less in payments than a traditional mortgage.

A financial services firm in Bend provided an example of a $300,000 loan, a 10-year ARM at 3.625 percent and a 30-year fixed rate of 4.25 percent. The firm’s calculations showed that the ARM would be $107 a month cheaper than the fixed-rate loan for the first 10 years.

And even in a worst-case scenario of the interest rate adjusting to 8.25 percent after 10 years, the home buyer would save money compared with a fixed-rate loan for 22 months into the adjustable-rate period. So, for nearly 12 years, the homebuyer would have paid less with an ARM than with a fixed-rate loan.

An ARM can work if your income will increase

If you know your income will increase before the interest rate on an ARM resets, this type of loan might be something to consider. An adjustable-rate loan can allow you to get into a house at a lower monthly price point than a traditional loan, and once that bump in income arrives – a spouse re-enters the work force, for example – the post-adjustment payment could be manageable.

Many of the scenarios in which an ARM appears not just workable but even advantageous are predicated on knowing what the future holds about your situation – whether you will still be in your house, whether your income will be greater, and so on. As the cliché goes, even the best laid plans … .

Knowing one’s risk-tolerance level and understanding the subtleties of an ARM are necessary in weighing whether one is better than a traditional fixed-rate mortgage. I have a wealth of contacts in the financial services industry and can put you in touch with a professional who will help you map out the most advantageous loan for your situation.

If you’re in the market for a home, or considering putting yours up for sale, as your Realtor, I will exceed your expectations in the course of your transaction. To learn more about how I can assist you in your Bend real estate transaction, contact me at (541) 383-1426, or visit Bend Property Search to connect with me through my website.

Related Posts

  • 53
    Don't Wait For Mortgage Interest Rates to Go Lower, Now Is the Right Time to Buy By Jason Boone BEND - Mortgage interest rates rose slightly this week but they still continue to remain at a one year low. The current mortgage interest rate for a 30-year, fixed rate mortgage…
    Tags: mortgage, interest, rate, loan, year
  • 49
    Mortgage interest rates in the United States fell for the second week in a row as more home buyers, especially those in Bend ventured out to start searching for homes once again. Thanks to recent statistics from Freddie Mac we know that the mortgage interest rate for a 30-year fixed…
    Tags: mortgage, interest, loan, rate, year
  • 46
    Mortgage interest rates are on the move again, and are only going up but the question that many Bend Oregon home buyers have is how high can they go? The answer to this question is anyone’s guess but, if you were old enough to remember the early 1980’s you will…
    Tags: mortgage, interest, bend, percent, year, loan, rate, years
  • 46
    By Jason Boone If you’re thinking about buying a home this spring it’s going to be a great time to buy thanks to historically low mortgage interest rates. Before meeting with your mortgage lender, learn how you can qualify for the lowest mortgage interest rate possible by following these simple…
    Tags: mortgage, rate, loan, interest, bend
  • 44
    When mortgage interest rates started going up recently, it seemed like almost everyone expressed some degree of shock or concern but, we now know that the increase in mortgage interest rates hasn’t affected home sales much at all and after a recent analysis of purchase contracts that were signed during…
    Tags: mortgage, interest, year, bend, percent, rate

Record for median sales price in June; $400K mark exceeded

Back-to-back months of declines in the median sales price of homes in Bend, Oregon, ended in June: The median price was $409,000 – a record for the 10-plus years for which the Skjersaa Group has data and the first time in that period that the median price has reached $400,000.

June 2017 figures share some characteristics from the same month in previous years, and the most important one might be that only once in the preceding 10 years was June the high-water mark for the median sales price in a calendar year.

June had the highest number of active homes (442) and the highest number of sold homes (246) this calendar year to date, as was the case with June each of the previous three years. In all three of those years, the June sales price exceeded what was then the year-to-date median price for the respective calendar year, but later months those years exceeded June’s median price.

Translation: Based on data from the last three years, June’s record-breaking sales prices could very well be eclipsed this calendar year.

It’s worth remembering that the median sales price is not an average sales price. The median is the amount at which half of the homes sold in a given month went for less than the median, and half went for more than the median.

Using the median figure rather than the average prevents the figures in question from being skewed by a handful of high-end homes.

(Which didn’t happen, anyway. Ten homes priced for $825,100 or more were sold in June, one fewer than in each of April and May.)

The inventory of homes on the market increased in June to 3.3 months. That’s the highest for a June since 2014, when it was 4.2 months. But, similar to a phenomenon we pointed out last month, the inventory for Bend as a whole is weighted by the most expensive tier of homes.

Inventory for homes in the range of $825,100 and $925,000 was 3.2 months, and for homes priced at $925,100 and up, it was 15.2 months. For homes priced up to $825,000 – which made up 79 percent of the active listings in June – the inventory was three months and less.

June’s median sales price was 10.5 percent higher than in June 2016. That marked the third year in a row that the year-over-year increase in June exceeded 10 percent. June’s $409,000 median price was 7.9 percent over the previous month’s – and that’s the highest month-over-month increase for a June since 2011, when the region was clawing its way out of the housing decline.

Another record was set in June, and that was for lowest average days on market: 91 days. It was the first time the average was less than 100 days since July 2016 (when it was 97 days) and only the third time since at least January 2007 (the extent of our data set) it has been less than 100 days.

It seems clear the real estate market in Bend has hit full stride. It’s an exciting time to be in the market – as a buyer or a seller. Whatever your position, I can assist in bringing about a solution that leaves you satisfied and in a great position.  To learn more about how I can assist you in your real estate transaction, contact me at (541) 383-1426, or visit Bend Property Search to connect with me through my website.

Related Posts

  • 86
    By Jason Boone The numbers of homes sold in Bend, Oregon, in January dropped compared with previous months -- which probably shouldn’t be a surprise given our weather -- but the median price of those homes that were bought was on the rise. The median sales price in January 2017 was…
    Tags: price, sales, homes, median, year
  • 66
    By Jason Boone Although the median sales price of a home in Bend, Oregon, dropped in July for the second month in a row, there are plenty of signs that the trajectory of the market has only slightly leveled off and hasn’t begun anything approaching a downward path. July’s median…
    Tags: price, sales, median, months, $, homes, year
  • 63
    By Jason Boone In my review of May’s home sales data in Bend, Oregon, I suggested that the market might have been reaching a peak. The figures for the three months since seem to support that theory. The median sales price of a home in August was $359,000. That represents the…
    Tags: price, sales, median, months, $, homes, year, days
  • 61
    By Jason Boone The median price of homes sold in Bend, Oregon, in May was the second-highest in the last 10 years, but there are signs that prices might be nearing or at a peak. At $374,000, the median sales price in May 2016 trailed only that of May 2007…
    Tags: price, homes, sales, median, months, $, days
  • 61
    The median sales price of a home in Bend, Oregon, set another record in July, the second month in a row that figure has reached unprecedented levels. But along with the rising median sales price came evidence that the market is highly competitive and buyers are pushing back on overpriced…
    Tags: sales, price, homes, days, median, months, june, $

Median sales price falls for second month in a row. What happened last time that occurred?

The housing market in Bend, Oregon, tapered slightly in May, as the median sales price fell for the second month in succession and the inventory of homes on the market rose compared with April. Still, the year-to-date median price remained steady at a price that represents a high for the 10-plus years for which we have data.

May’s median sales price was $379,000. That’s 4.1 percent lower than March’s median sales price of $395,000 and 2.8 percent lower than April’s median of $389,950.

If recent history is any indication, this dip could eventually turn into a trampoline. The last time monthly median sales prices declined in consecutive months was in 2016 (when they fell for three months in a row, in fact). That stretch of monthly declines after the median price reached $374,000 in May ended emphatically with a 7.5 percent month-over-month increase from August to September to $385,750 – the calendar-year high for 2016.

Two hundred seventeen homes were sold in May, four fewer than in April. The number of houses whose priced was reduced was 107 — 32 percent. The last time the percentage of active listings with a reduced price was that high was in the three-month stretch in 2016 when the monthly median sales figure dropped. (See the previous paragraph for what happened after that three-month stretch.)

Year over year, May’s median sales price showed a 1.3 percent increase from the corresponding month in 2016. That is the smallest year-over-year increase in a monthly median sales figure since January 2016. That month, the median sales price of $317,450 was 3.7 percent lower than in January 2015.

The 2017 year-to-date median price stayed at $380,000 after taking into account May’s sales. That remains the highest year-to-date median price on record. In fact, each month of 2017 has reset or tied the record for the highest year-to-date median sales price.

High-end homes a big part of inventory

The inventory of homes rose to 3.1 months in May. Inventory — expressed as the time that would be required to sell all homes on the market given the current pace of activity — was 1.7 months in May 2016.

May 2017’s inventory is skewed, however, toward higher-priced homes. Of May’s 337 active listings, 33 percent were priced at more than $725,000 (that percentage was 25 percent in March and 31 percent in April). For homes priced from $225,100 to $625,000, the inventory is in the range of two months. And two months of inventory falls well on the side of being a “seller’s market.”

Tied to the inventory is the volume of homes on the market. Each month this year, the active listings have been the fewest for those respective months in the 10-plus years for which the Skjersaa Group has data. As mentioned in the previous paragraph, the quantity of homes priced at $725,000 and less is particularly tight.

Late spring and summer traditionally are the most active months for real estate, and if you’re looking to buy a home or considering putting yours on the market, I can be of help. In my time as a Realtor, I have helped clients achieve their desired results regardless of the time of year and the trend of the market. To learn more about how I can assist you in your real estate transaction, contact me at (541) 383-1426, or visit Bend Property Search to connect with me through my website.

Related Posts

  • 90
    By Jason Boone Although the median sales price of a home in Bend, Oregon, dropped in July for the second month in a row, there are plenty of signs that the trajectory of the market has only slightly leveled off and hasn’t begun anything approaching a downward path. July’s median…
    Tags: market, price, sales, median, months, percent, $, inventory, homes, month
  • 90
    The median sales price of a home in Bend, Oregon, set another record in July, the second month in a row that figure has reached unprecedented levels. But along with the rising median sales price came evidence that the market is highly competitive and buyers are pushing back on overpriced…
    Tags: sales, price, homes, median, months, market, percent, month, inventory, $
  • 88
    By Jason Boone In my review of May’s home sales data in Bend, Oregon, I suggested that the market might have been reaching a peak. The figures for the three months since seem to support that theory. The median sales price of a home in August was $359,000. That represents the…
    Tags: price, sales, market, median, months, percent, $, homes, year, inventory
  • 84
    Even in the Bend real estate market, it’s reasonable to expect a slowdown in activity in the final months of the year, with fewer homes sold and prices dropping. Except this year, that’s not happening in Bend. November sales figures, in fact, showed an increase in the median sales price…
    Tags: price, homes, market, percent, median, sales, inventory, year, months, $
  • 83
    By Jason Boone The median price of homes sold in Bend, Oregon, in May was the second-highest in the last 10 years, but there are signs that prices might be nearing or at a peak. At $374,000, the median sales price in May 2016 trailed only that of May 2007…
    Tags: price, homes, sales, market, median, month, months, $, inventory

Do these 5 things before you move into your newly purchased home

So, you’ve bought a house? Congratulations. Few things in our lives are more momentous.

Before moving into your new home, though, there are some things you might want to consider taking care of. Addressing these items now, before you’re settled, will generally be easier or more beneficial that if you wait to have them done.

1) Cleaning duct work. The duct work in your home is generally out of sight, but don’t let it stay out of mind. Dirt and debris accumulate in your ducting over time and affect the quality of the air you breathe. Even if you’re moving into a new home, there is reason to have your ducts cleaned before moving in. Dust, dirt and construction debris can fall into the ducting of even new homes. When choosing a company to clean your ducts, make sure it operates a truck-mounted system. Anything with less power will likely do no more good than an off-the-shelf shop vacuum.

2) Interior painting. The paint scheme of a house is among those things a buyer can change, unlike its location or the size of its yard. If you’re considering having your interior painted, keep in mind that it’s much more convenient to do it before the house is inhabited. Moving furniture to allow access to walls, and then dancing around that furniture while it’s out of its normal position, can be a headache. An acquaintance of mine said it was much easier putting up with weeks of major renovation in a bathroom than it was to endure the disruptions caused when he had his master bedroom and living room painted.

3) Carpet cleaning. Unless you’re moving into new construction, it’s safe to assume that the carpet in your home has had its share of traffic and its share of stains. Consider who else might have lived in your home — renters, maybe? — and their possible incentive (or lack of it) to keep the carpet in top shape. Particularly if you have children who presumably will play on the carpet, it’s worth considering getting a professional carpet cleaning.

4) Wall and ceiling fixtures. Related to completing any interior painting before moving in is evaluating fixtures such as lights and ceiling fans. If you’re thinking of replacing them, it’s best to do so before you move in — and before you have any interior painting done. It’s hard to determine, when changing fixtures, how much of a wall or the ceiling a new fixture base will obscure. Changing fixtures could uncover a paint scheme that no longer matches the remainder of the room.

5) A whole-house water filter. This is of concern in areas of hard water or questionable water quality. Hard water can stain appliances and your clothes. A build-up of materials can reduce the effectiveness of appliances and shorten their life expectancy. Installing a whole-house water filter before taking up residence in a new home will prevent the hard water from damaging appliances. Having appliances free of scaling stains will be a benefit should you in turn decide to sell your home. Appliances with hard-water build-up can turn off prospective buyers.

I love seeing people move into new homes. If you’re in the market to buy a home in Bend, Oregon, or if you’re considering selling your home, I’d like to help you. I have experience with and knowledge of the Bend market that will benefit you. To learn more about how I can assist you in your real estate transaction, contact me at (541) 383-1426, or visit Bend Property Search to connect with me through my website.

 

Related Posts

  • 31
    By Jason Boone Selling Bend Oregon Real Estate is one of the most exciting things you will do but the reality is that most people don’t know how to prepare their homes for sale and many times they sell their homes for a lot less than they are worth. In…
    Tags: will, bend, ceiling, homes, painting, house, cleaning, things

Solid evidence that we’re not in another housing bubble

As the median sales price of a home in Bend, Oregon, nears the heights reached before the housing market crash, it’s reasonable to wonder if we’re experiencing another bubble.

Although no one can predict the future, there are solid indications that the rise in housing prices is not due to speculation or unsound lending practices. Instead, the evidence supports the theory that supply and demand are driving housing prices.

Interest rates this week hit a calendar-year low, despite recent increases in the Federal Reserve’s benchmark rate. The average of 30-year fixed-rate loans dropped to 3.95 percent (assuming an average of 0.5 point — a fee a borrower pays that corresponds to 1 percent of the loan amount.) Rates such as these — very low from the long-term U.S. housing market perspective — increase the buying power of those looking for homes.

Another piece of evidence is the percentage of mortgage originations with a relatively low credit score. Credit scores of less than 620 drew the largest percentage of mortgage loans in the first quarter of 2007 than at any other time in the last 14 years. In fact, sub-620 credit scores in that quarter had a larger share of the market than credit scores between 620 and 659.

Today, sub-620 credit scores make up a small fraction of mortgage originations — it’s the smallest credit-score segment obtaining mortgages. The conclusion: People who are buying houses have the financial means to do so.

Labor market indicators and the trend in the United States’ gross domestic product also argue against a recession in the near future. In Bend specifically, there are a sizable number of residents whose livelihood does not rely on local economic activity. The diversification that Bend’s abundant home-based workforce adds to the local economy provides a foundation of support to the local real estate market.

Also, as Bill Valentine, of wealth management firm Valentine Ventures has said, there are more people who want to live in Bend than the local housing supply can keep up with. Bend’s population has grown by 5 percent from 2016, according to a U.S. Census Bureau estimate released this week. The Bulletin noted that equates to 12 people moving to Bend every day.

When CoreLogic’s national forecast calls for a 4.9 increase in home prices by March 2018 — and that’s a forecast that encompasses all of the United States, not just a growing city such as Bend — it seems reasonable that prices in Bend could continue to increase — and increase more than the national average.

“If you want to see where we’re headed, look to other exclusive mountain towns,” Valentine said. The median price of a home in Boulder, Colorado, for example, is almost $550,000, about 38 percent higher than in Bend.

Clearly Bend’s is a dynamic housing market. Whether you’re looking to buy a home or considering selling, I can use my background and experience to help guide you through the process. To learn more about how I can assist you in your real estate transaction, contact me at (541) 383-1426, or visit Bend Property Search to connect with me through my website.

Related Posts

  • 61
    By Jason Boone Thanks to historically low mortgage interest rates, and decreased costs for some of the markets best mortgage products, mortgage applications soared last week. The total volume increase for mortgage applications was close to 50% but the reason for that could be due to more people coming back…
    Tags: mortgage, bend
  • 48
    Anyone who has followed the Bend, Oregon, real estate market coming out of the great recession has probably wondered: How long can prices keep rising? After all, mortgage interest rates have moved off their historic lows and appear headed for further increases. Higher interest rates cut into consumers’ buying power,…
    Tags: prices, percent, bend, housing, increase, market, mortgage
  • 47
    By Jason Boone Even as the housing market rebounded from the depths of the recession, big banks largely stood on the sideline. They watched as nonbank institutions -- companies that only make loans and don’t offer traditional banking services such as savings and checking accounts -- gobbled up more and more…
    Tags: mortgage, market, percent, housing
  • 40
    By Jason Boone 2014 was a good year for housing starts since more homes were built in Bend and nationwide. Last year we saw an overall gain in housing starts of 8 percent and that’s encouraging considering the shortage in home inventory we had to deal with during 2013. What…
    Tags: housing, bend, percent, market
  • 38
    Is the housing recovery still on track? Learn more about the 2014 Oregon housing market By Jason Boone Thanks to the 2014 Oregon Housing Market Report we know that the housing market still continues to remain on the right track with the rest of the country. Home prices have increased…
    Tags: market, housing, mortgage, bend

Jason Boone | Principal Broker, CRIS | Duke Warner Realty | Skjersaa Group
Oregon Real Estate Licensee | 1033 NW Newport Ave Bend, Oregon