Have We Hit A Housing Trifecta?

Conforming 30 year fixed rate mortgages are now averaging just a tad under 5.5%, while "Jumbos," those loans above $417,000, are now in the 6.5% range. Less than 6 months ago, these rates were closer to 6.3% and 7.2% respectively.

To put this in perspective, a $400,000 loan 6 months ago had a monthly payment of about $2476 (P&I). Today, the payment for that same loan amount would be $2271, a savings of $205 per month!

Another way to look at this is to consider the increase in your purchasing power. 6 months ago, a payment of $3395 would get you a loan of about $500,000. That same payment today would give you almost $37,000 more!

Home prices have come down, there are many nice houses for sale and interest rates are very low; a housing trifecta! You just might now be able to buy that house of your dreams! Call me to find out. After all, it doesn't hurt to look.

More On Vacant Houses

As a follow up to the last post, 46% of houses on less than 1 acre and currently listed for sale in Bend are vacant according to data from MLS.

There are 1256 stick built houses on less than an acre listed for sale. Of those, 256 are vacant "existing" houses and 328 are "new construction" with completion dates of February 29 or sooner.

While it's doubtful that all of the "new construction" listed with completion dates between now and the end of February will be finished as scheduled, there are still a lot of empty houses waiting for buyers.

39% Of Homes For Sale Are Vacant

According to data culled from the MLS, 634 out of the 1639 stick-built houses, townhomes and condos currently listed for sale in the greater Bend area are vacant. That's 39% of the total inventory of houses for sale.

475 of the vacant properties are listed as new construction. Of these, 396 show that they're completely built or will be by the end of February.

Inventory Declines Over 10% In One Week!

Nearly 200 housing units were taken off the market in the greater Bend area between December 30th and January 2nd, resulting in a decline of more than 10% in the supply of residential properties for sale.

Most of the properties were removed from the market due to the expiration of listing contracts.

No doubt that many of these properties will be relisted, but any reduction in our inventory is a step towards a better market environment.

Lower Prices Leading To More Sales?

At the risk of being overly optimistic, we may have reached a point where the lower prices in some segments of the market are encouraging more and more people to get off the fence and buy. Here's what I see in Bend:

• 84 existing stick built houses on less than one acre sold in October for a median price of $308,000. The median size was 1885 square feet. Of the 67 sold a year earlier, the median price was $350,000 with 1846 square feet. Slightly more house now for 12% less.
  

• Overall, 93 existing stick built houses sold in October. The median sale price was $314k with 1924sf. In October 2006, the comparable numbers were 84 sales, a median price of $384.5k and 1868sf. Again, a bit more house for about 18% less.
  

New home builders are taking a different tack (for various reasons); much more house for about the same price. It's still been beneficial to buyers:

• 26 new homes were reported sold in October. The median price was $378k, down less than 1.5% from a year earlier. But the 50 houses sold in October 2006 had a median size of 2212sf. This year, for slightly less money, buyers were able to get a house nearly 9.5% bigger (2422sf). That's an extra bedroom, office or bonus room.

Note that the volume of new home sales is down by almost half from a year earlier. I'll be watching to see if builders will stick to this strategy or begin to reduce prices more to move some inventory.

Prices Continue Decline

The median sale price for residential properties in the greater Bend area fell to $330,000 in October, according to data from the MLS of Central Oregon. Existing homes saw the biggest drop in prices, with a reported median sale price of $313,000 in October, down 19% from a year earlier and 5% from September. New home prices were also lower, with the median sale price for October reported to be $378,000, compared to $391,300 in September.

Existing Home Sales Stabilize

Sales of existing homes in the greater Bend area registered an increase in October from a year earlier. There were 92 reported sales of existing, "stick built" (non-manufactured) houses in October compared to 84 in October 2006. The sales number matched the number reported in September, possibly signaling that the downturn in sales of existing homes is leveling off.

The rate of increase in sales was even greater for existing homes on less than one acre. The number of sales reported was up nearly 24% to 83 units, from 67 a year ago. October sales also improved slightly from 81 in September.

New Home Sales Fall Considerably

Not all sectors of the real estate market held their ground last month however. The slowdown in new home sales accelerated in October, with only 25 reported closed sales in the greater Bend area. This is a decrease of 50% from a year earlier and down from 30 units in September.

Part of the big decline in new home sales could probably be attributed to the fact that many of sales reported last October were for purchase contracts agreed to in the Spring and Summer for houses not finished until the Fall.