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Last week, I showed significant increases in median sale prices year over year in Central Oregon. Today, let's complete the picture by looking at inventory levels and days on the market. I write these reports primarily to bring hard data to the conversation about housing in our area, as I so often speak with buyers and sellers with an inaccurate view of the market. One misconception I hear repeated is that home prices are declining. Last week's data proved this is not the case, but price reductions in the active market are the most likely culprits that spur that narrative. When a home is listed at a high price and lingers without a sale, then reduces the price, it is easy to assume prices are dropping. However, the price was too high in many cases, and the reduced price is still higher than or equal to past sales. Knowing past median sales data is imperative to accurately viewing today's prices.
Market Trends
The logical assumption is that increased inventory drives prices down. While more homes for sale will eventually tip the scales towards lower prices, many real estate market dynamics prevent that from happening. One dynamic preventing a significant price drop is the short days many homes are listed before securing a contract. This year in Central Oregon, sales are slightly up from last year, but many more sellers are listing homes, bringing an increase in inventory. More selection has opened up opportunities for buyers conditioned to a supply-constrained market to find their perfect fit, and they are seizing the opportunity. The data shows pending and sold properties with very low days on the market. While some homes linger, others are snatched up very soon after listing, creating an uneven market that requires focused attention to track. The percentage of near-immediate sales keeps prices firm and rising in many cases.
Deschutes County Listings
This morning, there are 1156 single-family homes for sale in Deschutes County, seventy-eight more than last week. For reference, on June 21, 2023, there were 762 single-family listings in the county. The significant increase in supply has helped keep sales relatively strong but still falls short of past inventory levels. Pending sales in the county show median days of eleven, with twenty-two days for the sold properties. Downward price trends require inventory increases and an increase in days on the market, which is missing from today's data. Attractive, well-priced properties are moving quickly.
Crook County Listings
Crook County's home inventory shows 141 listings, up four from last week. Unlike Deschutes County, Crook County's inventory this week in June last year was up five from this morning, flat year over year. Coincidentally, the price appreciation in the county year to date was a very average 3.6%. Reading between the lines, the smaller pool of homes for sale has hindered buyers' options, making the Crook County market challenging to navigate. With a population of just under 27,000, Crook County's inventory would be hard-pressed to increase dramatically without significant outside pressure to drive the market. Considering the growth of Prineville and the county, the housing market has reached a relative balance, preventing any substantial dips or jumps. The good news for buyers and sellers in Crook County is the market is easier to read than some of the hotter locations in Central Oregon. Still, the median pending days listed this week was twenty-four, with sold sales at thirty-nine.
Jefferson County Listings
Jefferson County's inventory dropped one from last week, now at ninety-nine. This week last year, there were only seventy-one listings in the county. While the increase helps buyers with more selection, there are still very few options at any particular price point in Madras and the surrounding areas, with thirteen listings over $1M and twenty-six under $400k. Like Crook County, Jefferson County is still a supply-constrained market that buyers must consider when searching for properties.
Caldera Springs Listings
Inventory will continue to increase throughout Central Oregon through Labor Day or beyond, creating opportunities for buyers ready to respond. However, those opportunities will likely be more selection and the right mix of features, not lower prices. The likelihood of a rate pivot from the Fed is improbable for 2024. Even if there is a rate reduction before year-end, anything more than 25 basis points seems to be a long shot. If the economy is as strong as many claim, why would the Fed need to reduce interest rates? And if we are heading towards, or already in a recession as others claim, but inflation is still a problem, lowering rates would exasperate stagflationary trends. The Fed is in a rock and a hard place with monetary policy, no matter how you view today's economy. Considering home price appreciation today, lower mortgage interest rates will likely only fuel the fire. Our market is difficult for many to navigate, but when it comes to lower interest rates, you should be careful about what you wish for.
Testimonials
My knowledge of the Central Oregon housing market exceeds what can be written in a short update or gleaned from a cursory reading of the national news. No matter where you are looking or what type of property you need, I am always available to help you sort through your options.
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