Bend Home Sales Slow, Prices Mixed

Single family home sales in Bend slowed from a year earlier in June, while prices continued to show some stability.  139 closed sales were reported to the MLS of Central Oregon last month, compared to 152 a year ago.  The median sale price was $210,000, down 3.21% from June 2010.  On a square foot basis however, prices increased 6.21% to $116.67/sf.

The number of closed short sales increased 23.33% and were more common last month than bank-owned foreclosure sales, which declined 32.5% from a year earlier.  Short Sales accounted for 26.6% of all stick-built, single family homes in Bend last month, while foreclosures made up 19.4%.   

Does The Bend Housing Market Now Favor Sellers?

The sales pace in February for single family homes on less than an acre would seem to indicate that sellers are now calling the shots in the Bend housing market.

There were 109 houses sold in February in Bend and 414 finished homes are currently listed for sale, resulting in less than 3.8 months of available inventory.  A market has typically been considered  "balanced," favoring neither buyers nor sellers, when there are about 6 months of inventory available.  But with so many distressed properties and a double digit unemployment rate, how can this be true in Bend today?

One explanation I have is that banks are being very careful in controlling the number of foreclosed homes they list for sale in an effort to avoid flooding the market and driving prices even lower.  And a quick analysis seems to bear that out.

As I write this, only 46 of the 414 currently active single family home listings in Bend are shown to be foreclosures.  That's 11.1% of the market.  But similar bank-owned properties accounted for 43% of homes sold last month!

So while only about 1 in 10 houses for sale in Bend are foreclosures, more than 4 of every 10 sold are bank-owned.  Can and will this trend continue?  Let me know your thoughts by replying in the comments section below.

Foreclosures Drag Bend Home Prices Lower

The median price per square foot paid in Bend last year for stick built houses on less than one acre was $104.66.   But this figure differs dramatically depending on the type of sale.

While the overall median price per square foot paid in 2010 was down 6.6% from a year earlier, the price per square foot for all "traditional" sales (not a foreclosure or short sale) decreased by less than half that, down just 3% from 2009.

And short sales, besides seeing a jump of more than 20% in the number of successful deals last year, had a 6.2% lower median price per square foot than those from a year earlier.

So where does this leave foreclosures?  The median price per square foot paid for "bank owned" properties plunged 11.1% last year.  At $87.32 per square foot, foreclosed houses sold for a whopping 30.9% discount from traditional sales!

While I'll agree that there is more perceived risk in buying a foreclosure (seller's are exempt from disclosing to a buyer any defects affecting the property, for example) and that many need at least minor repairs (paint and carpet, etc.), a discount of 31% seems a bit extreme.

As a result, and as many buyers and investors are discovering, foreclosures are providing some truly fantastic buys, even in today's choppy market.

Let me know your thoughts by posting your comments below. 

Bend Home Sales Volume Up 7.9% In 2010

1687 stick-built houses on less than one acre in Bend were sold last year, an increase of 7.9% from 2009. 

The mix of sales was little changed from a year earlier.  723 of the houses sold (42.9% of the total) were "traditional" sales, while 579 (34.3%) were foreclosures and 385 (22.8%) were short sales. 

In 2009, 680 (43.5% of the 1564 houses sold) were "traditional" sales, 564 (36.1%) were forclosures and 320 (20.5%) were short sales.

More than half of the 123 additional houses sold in Bend last year were short sales, while only 15 were foreclosures.  43 more "traditional" sales closed in 2010.

On a price per square foot basis, the median price was down 6.6% from a year earlier.  In my next post, I will cover some very interesting details of what accounted for most of the price decrease.

In the meantime, if you or someone you know is considering a move, please call me.  I represent both buyers and sellers, have experience in handling the sale of traditional, short and foreclosure properties and am recognized as a Certified Distressed Property Expert by the Distressed Property Institute.

October Homes Sales Highest In Over Three Years

Single family home sales in Bend reached a level not seen since August 2006 last month.

There were 172 closed sales reported to the MLS of Central Oregon in October. We have to go back more than 3 years to find a month with more sales; 200 transactions closed in August 2006. The next closest monthly sales number over the last 3+ years was 159 in March 2007.

The 172 sales represents an increase of 52.2% from October 2008 and a gain of 13.2% from the 152 closed in September.

Distressed property sales continued to drive the market, with 59 bank owned and 35 "short sales" closing last month, amounting to more than half of all sales (54.7%).

The dollar per square foot price seems to have flattened out, as October's median of $113.93/sf is the 4th time in the last 5 months where $/sf has come in between $109/sf and $114/sf. (The low for the year incidentally was $105/sf in April, while the high was $125/sf in January. The average for the 1st 10 months of this year is $113.5/sf).

There are still many good buys out there and more short sales are coming together each month, so if you're in the market to buy or sell, please give me a call to discuss your situation.

Short Sales and Foreclosures in Today's Market

There is a lot of news about distressed properties in today's real estate market. Though short sales and foreclosures are both considered "distressed sales," the processes and your success in buying one are very different from each other.

While buying a foreclosure generally only requires that you get the lender/seller/owner (typically a bank) to agree to your offer price and terms, a short sale requires not only the seller/borrower's approval but the seller's lender (or in many cases, lenders) must also accept the price and terms of the contract. This is a HUGE difference.

The following recap of May sales sheds some light on just how divergent these two types of transactions can be.

Of the 119 total closed sales in May for stick built houses on less than an acre in Bend, 13 were short sales (10.9%) and 54 were foreclosures (45.4%). Contrast those percentages to the proportion of houses currently listed for sale that are short sales and foreclosures; 32.9% and 5%, respectively.

So while short sales account for nearly 1 in 3 houses listed for sale, they make up just over 1 in 10 closed sales. On the other hand, only 1 in 20 houses for sale is a foreclosure but nearly half of closed sales last month were bank owned!

In addition, the time it took to close the 13 successful short sales last month was a median of 131 days. On the contrary, the median number of days it took for a foreclosure sale to close was 75, nearly 2 months shorter! (The median time on the market for all sales last month was 107 days).

If you or someone you know would like to learn more about the differences between traditional transactions, short sales and foreclosures, please give me a call. I'd be happy to talk with you about the many important differences you need to know about, whether buying or selling.

"Distressed" Properties Account For 1 In 4 Houses For Sale

There are currently 1167 stick built houses on less than one acre of land in the Bend area listed for sale in the MLS of Central Oregon. Of these, over 25% are showing as distress sales, meaning either a "short sale" or "bank owned" property.

A transaction is considered a "short sale" when net sale proceeds (sale price less transaction fees) yield less than what is currently owed on the property. In order to close the sale, the property owner must either pay the difference between the net sale proceeds and what is owed or get the lien holder(s) to accept less than the amount owed. There are 196 stick built houses currently listed as a "short sale," accounting for nearly 17% of the available inventory of houses for sale.

In addition, there are 99 houses in Bend owned by a lender and listed for sale. This represents 8.5% of stick built houses currently listed for sale in the area. In most cases, the lender has come in to possession of the property following a foreclosure proceeding.

Of the 66 closed sales of stick built houses on less than one acre in the Bend area in January, 29 (or 43.9%) were reported as distress sales.