Duke Warner and Bratton Market Reports for May 2012

After several weeks of unusually warm weather the Central Oregon region has returned to a more typical weather pattern. Unlike our weather our real estate market continues its phenomenal hot paced recovery. Both the Duke Warner Market Trends Report and the Bratton Report illustrate the continued strengthening of the Bend, Oregon real estate market.

The current refrain from my clients is “I could just kick myself!! I could have had this same property for so much less last year…”. While it is true that as little as six months ago you could have purchased a property for quite a bit less than you can today, there is  not much use in sulking as that ship has set sail. By not acting soon you could be saying the same thing next year at this time but with higher interest rates. Higher interest rates equal less home buying power for the average buyer.

The Federal Reserve has committed to purchasing mortgage back securities until spring of next year. Their 40 Billion dollar commitment is helping hold down the interest rates to near record lows. Should the real estate market and the national economy continue to strengthen it will be unlikely that the Fed will continue to prop up the market. The market would then return to a free market situation where rates are sure to rise.  

Today’s low rates combined with a tight inventory of desirable homes under $350,000 have many feeling like they are experiencing 2004 -2005 all over again. While I do not think we are on the same path history does tend to repeat itself. The run up we are currently experiencing should level off in the fall going into winter. Many of the construction permits for new homes pulled this spring will be completed and into the market. This will be combined with the return of the average home seller who feels the market has stabilized enough to put their home on the market and get a decent price for their home.

One other factor unique to Oregon could be the return of the big banks releasing more distressed properties to the market. By late June the 2013 Oregon legislative session will have ended. In reaching the end they should have reached their conclusion of re-writing the mortgage mediation bill. The current incarnation (SB 558) is to include judicial foreclosures in addition to the non-judicial foreclosures. Non-judicial foreclosures where covered in SB 1552 from last year.

Contributing to resolution of how distressed property foreclosures will be handled in Oregon will be the Oregon Supreme Court handing down their ruling on the legality of MERS handling foreclosures on behalf of the lenders. One way or another the big lenders should have an idea of the path they will take to resolve their inventory of distressed properties by summer’s end. This should result in a return of bank owned (REO) homes in a decent quantity to our market place. 

    

Bottom line rates are low; the economy is improving and now is a great time to invest in the future of Bend and you.

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