Dramatic Rise in California Home Sales

According to information released by MDA Dataquick, home sales in California jumped 65% in September from a year earlier.

And perhaps more importantly, the sales recorded in September were also up about 6% from August.

While more than half of the existing home sales recorded in California last month were foreclosure resales, and the median price of those sales was down 34.2% from a year earlier, it does provide proof that there are ready, willing and able buyers today.

This is a good sign for the market locally since California is a big feeder market for Central Oregon. There's no doubt that some of these recent home sellers are now in the process of relocating to the Bend and buying homes here.

According to Dataquick, the inflation-adjusted mortgage payments homebuyers committed themselves last month were back to where they were in early 2001, before home prices shot up so drastically.

Speaking from personal experience, it seems to me that there are more people out "kicking tires" and inquirying about properties listed for sale.

Hopefully this trend will continue from here on.

Bend Still Drawing Press

CNN.com's Travel writer Naomi Lindt featured Bend in a recent article.

http://www.cnn.com/2008/TRAVEL/getaways/10/15/bend.oregon/index.html

Real Estate Auctions - Don't Buy 'Em!

While real estate auctions are most often associated with distressed properties up for bid on courthouse steps, some companies are trying to take advantage of today's market by pitching auctions as a viable alternative to traditional marketing methods. But are auctions worth the thousands of dollars sellers are required to pay upfront to the auctioneer regardless of whether their property actually sells? And do buyers necessarily get a good deal buying at auction?

Auction company owners and employees like to portray the auction process as effective at establishing a property's market value. But “true” market value is ultimately determined by exposure to the biggest, broadest market possible. And today, with widespread public access to MLS information and a seemingly infinite number of real estate websites allowing visitors to search for property online, reaching a broad market of potential buyers is easier than ever. Auctions certainly don’t expand the market any further.

A property seller would be much better off listing their property with a real estate agent at the minimum price they are willing to accept (think of it as the "reserve price" used at auctions) and stating that they will not be responding to any offers for x number of days to ensure that the property receives broad exposure. This is a common strategy with lender-owned properties and it sometimes results in multiple offers. And unlike the auction process, it costs the seller nothing!

Another quirk about auctioned properties is that they’re typically sold “as is.” A winning bidder is often required to put down a non-refundable deposit BEFORE having the property professionally inspected or even appraised! Of course, a bidder could elect to have a house inspected and/or appraised beforehand. But who in their right mind would be willing to shell out hundreds or even thousands of dollars to do so before having some type of assurance that they will have first dibs on the property? What about inspecting it afterward? While this is possible, keep in mind that the seller is not obligated to fix any defects discovered. A buyer’s only options then are to go forward with the sale or forfeit thousands of dollars of deposit money.

Furthermore, most auctions allow the seller to set an unpublished “reserve” price. If no bid meets or exceeds the reserve amount, the seller is not obligated to sell. Any bidder who has paid out money to have the property inspected and/or appraised is SOL. Does that seem like the best way to go about buying a house?

There is an auction scheduled to be held in Bend tonight. I'll write about the results soon, though I'm not expecting much.

Number and Pace of Home Sales Up From Last Year

Despite widespread reports of buyers having difficulty obtaining loans and a slowing economy, September sales reported to MLS show that 119 stick-built houses on less than one acre were sold in Bend. This is the highest number of sales reported in at least a year. A year ago, 114 houses were reported sold in September. The 119 houses sold last month is also a big improvement from the 97 reported sold in August.

In addition, the amount of time it took to sell a house in the just completed 3rd quarter was less than a year ago. The median days on the market (DOM) for houses sold in the 3rd quarter was 137 days. A year ago it took more than 2 weeks longer, with a median DOM of 153 days. And the pace quickened even more last month, to a median of 132 DOM.

The median price of houses sold in September was $277,900, 16.2% less than a year ago.....and 26.8% below 2 years ago.

On a price per square foot basis, the change is even more dramatic; last month, the median sale price per square foot for stick-built houses on less than an acre in Bend was $139.3/sf. A year ago, this number was $182.7/sf and in September 2006, it was $197.8/sf.

There are plenty of great houses to see (about 1500 are listed for sale in Bend) and interest rates are still near historical lows (around 6% for a 30 year fixed rate)
If you haven't looked in a while and are curious to see what you can get for your money now, or you want to know what your house is worth in today's market, call me, with no obligation, of course.