The Bratton Report which is produced by Mike Caba Bratton Appraisal Group shows that the median price of homes sold in Bend Oregon for the month of May 2008 were down approximately 23 percent from May 2007. The median price in May 2007 was $396,000. May 2008 median price was $303,000.
The report did show that the peak median price of homes sold in Bend during the Bull real estate market was in May 2007 so it is a tough comparison. It seems that the median price lags behind the reality of the market in Bend. The median price in November 2006 was $305,000 so we are back to 2006 prices.
The number of homes in Bend sold during the same periods was down approximately 36 percent! There were only 102 homes closed in May this year as compared to 159 last year.
Bend Oregon homes are selling if they are priced right! I just closed another escrow on the sale of a home in SE Bend. It was on the market for less than 60 days and the owners had their cash in 71 days. It was a good older home that needed a little work but it was priced right.
I closed a home last month on the golf course at Rivers Edge for $629,000. The buyers are from California and feel they got a great buy. I also closed another home last month that sold to different California buyer. They bought a beautiful home in SW Bend that is close to the Deschutes River.
The Bend Oregon real estate market is slow. There are not many serious buyers. But homes that are priced right are attracting buyers and sellers are selling their homes if they are priced right.
The economy does not look good. Gas prices are high and don't look like they will be coming down any time soon. The local news papers are starting to hint at a "little recession" and unemployment seems to be going up. On top of all of that the stock market is still coming down.
It looks like prices will continue to fall for the rest of this year as I am seeing limited buyer activity and more short sales and bank repos coming on the market. This year looks like a good time to buy. Unless our national economy goes in the toilet I look for prices to bottom out next spring.
Bend Oregon has seen some of the fastest growth in the nation in the last few years. Its population has grown steadily and real estate prices have risen dramatically. The real estate market has cooled down some now but there are still some opportunities out there for the smart investor. The days of buying a house, condo or land and then "flipping" it are over.
The good investments are going to be centered around the City of Bend's new Juniper Ridge development in North Bend. The City Commissioners are planning on a mixed use zoning and have already annexed 500 acres into the city limits. Most of this first phase will be light industrial (IL) zoning and research and Development. But the second phase will possibly have a new four year college campus, some commercial and residential.
This land is all owned by the city of Bend but there are several hundred acres of private property around the development that are for sale now or will be on the market shortly. These are the properties that a smart investor can make some money on.
Most of this land is small hobby farms from 3 to 20 acres. It is currently zoned for low density use. However, the city is in the process of rezoning most of this property and bringing it into the city limits. A new sewer main is proposed to border the south end of Juniper Ridge and run east to the sewer plant
The city is supposed to make their proposed changes public on March 26, 2007. This is two years later than what was initially planned. Delays in infrastructure engineering required by the state have been the cause. So this date is not etched in stone. However, it should be made public soon.
The smart investor could be buying some of the surrounding properties now and possibly doubling their money in a couple of years. Similar land has been selling in the last couple of years for $250,000 per acre and more. Investors should be tying up properties with contingencies prior to that time. There are sellers out there willing to sell their property with an extended closing date subject to rezoning
Development land currently inside the city limits (UGB) is listed for sale at $500,000 to $600,000 per acre. However it's not selling at this time. There is an over supply of available lots. But these lots should sell out this year. It's the authors' opinion that residential land inside the city limits will settle out around $450,000 an acre next year when the city moves the city limits.
Everyone seems to be waiting for the city to make a determination on where the new city limits will be and what the zoning will be. Several investors paid over $250,000 an acre on land outside the UGB thinking that it would be developable and buildable today. That has not happened. Once the boundary proposal is official you will see more activity in the market for development land.
Finished lots on Bends East side have been selling for around $160,000 each. They are around 8,000 square feet. Larger lots sell for more. The minimum lot size today is 4,000 square feet according to city building code. The trend is towards larger homes on smaller lots.
On site infrastructure has been running between $25,000 and $30,000 per lot. Large amounts of rock and or sewer pump stations can add to the costs. Off site costs can also add up quickly. Today's cost to bring in a sewer main is around $100 per foot.
As of the end of February 2007 there were 59 single family lots for sale in Bend with an average size of 5,183 square feet. The average asking price was $164,800. Past sales of bare land outside the city limits on the East side have been averaging $270,000 per acre. Properties with homes and other improvements have averaged $291,000 per acre.
Bends real estate market is cooling its jets for a while but rest assured it will heat up soon. Bend is a great place to live and there will continue to be more and more people moving here. The development of Juniper Ridge by the city will add more jobs to the mix and the need for more housing.
Investments in land on the outskirts of Bend will pay huge dividends in the future. Much of the land will be zoned for residential. But there is some land that will become commercial or light industrial. An investor does not have to develop the land. Just hold it for a couple of years and resell it.