Has the Bend real estate market hit bottom at last? It’s too soon to say, but at least it looks like home prices here have finally reached a realistic level.
IHS Global Insight, which maintains huge databases of all sorts of economic data, reported back in March that as of the end of 2009, real estate in the Bend Metropolitan Statistical Area was overvalued by only 2.3%. (At the end of 2005 Bend real estate was among the most overvalued in the country – 44% above what Global Insight considered fair value based on market history, local incomes and other factors.)
And prices here have continued to fall. The real estate tracking site Zillow reports that the median Bend home value in the second quarter of this year was a mere $176,000. That’s an astonishing drop of almost 60% from the market’s peak on June 1, 2006, when the median was $374,000. During the past year the median value has dropped 18.9%, leading (if that’s the right word) the nation.
Is the local market poised for a comeback? “Just last week … a Bloomberg Businessweek report forecast that Bend would have the nation’s second-strongest housing rebound by 2014, with a 33.6% uptick in prices,” The Bulletin wrote Tuesday in a story about the Zillow data.
Bend financial adviser and blogger Jesse Felder isn’t ready to uncork the Dom Perignon just yet, though.
“Prices can and usually do decline well below fair value after a bubble bursts,” he notes. “Still, we’ve come a long way in working off the massive excess in local home prices and current buyers can feel good knowing that they are no longer paying a premium above fair value.”
This article appears in Aug 12-18, 2010.
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I have to agree. However, I think a disparity exists in short sales and distressed properties and the prices that some sellers are convinced their homes are worth. I’m seeing properties in Bend almost side by side. Short sale or bank owned say $159,900. House across the street, asking 289K?? Also, in light of the recent Fed report on the economy, jobs, and watching the stock market fall off a cliff today, I’m not so sure that the lack of jobs may have a profound effect on our economy overall. Many are predicting another double dip in housing and the recession. The fact that China’s imports are down significantly and their inflation is up is going to upset the global market going forward. Bottom line..most of our companies strengths are coming from sales to China, Brazil, India, etc. Catapillar took a huge hit based on their sales to China. And, as you and I have talked about often..no such thing as a jobless recovery. Then I hear that Barney Flippin Frank and CO. want to spend 2billion to offer HUD home owners a 50K each bridge loan, (no interest), for 2 yrs, but only if your unemployed and are current on your payments??? SAY WHAT??!!! This isn’t just kicking the can down the road, it’s lobbing “hand grenades” into taxpayers front rooms! God I’ll be glad when the next election is over. All this political posturing makes me want to upchuck! I’m praying that the short sale goes through on Angela, so I can slam the door and do a digial disconnect for months.
Thanks Sonya:
“I’m seeing properties in Bend almost side by side. Short sale or bank owned say $159,900. House across the street, asking 289K??”
Yep, I think some homeowners in Bend still have an unrealistic idea of what their house is worth.
On the plus side, the California real estate market seems to be turning around, and that’s always been the driver of the Bend real estate market.
The bottom will be in when we stop seeing people default on their loans and see the level of foreclosures slow or stop. Right now I don’t see that, still plenty of people in distress and more becoming so every day. When that stops the bottom will be in.