The Bratton Report for May 2013 is now available by following the link. The report confirms the findings in the Duke Warner Market Report released earlier this month that the Bend real estate market is smoking hot.

The graph driven Bratton Report shows a steep climb for sales the last four months. In fact the past four months mark the steepest gain in homes sold for a period running back to April of 2005. Unfortunately my data base does not go back far enough to capture the start of the great run up of the 2004/2005 so I cannot compare today’s market climate to the start of that wild ride. Sales volume for May also marks a level not seen since May/June of 2006. This level being the last plateau before falling of the economic cliff and into the “Great Recession”.  

While the sales volume rose dramatically the median price of a Bend home stumbled a tad for the second month. Given the crazy level of sales for the current month, June, I would expect the median number to jump significantly in the next report.

Inventory levels have seen an increase in the recent weeks which will assist in real estate brokers being able to find homes for their buyers thus helping keep the sales ball rolling. The one kink in the armor is the continued rise in interest rates, which will continue to increase as we move forward. As they increase buyer’s will start to see their buying power shrink.

Next up will be the return of distressed properties to the market which will help bolster the inventory levels. Though I believe that it will be next spring before the lenders and state of Oregon get their differences figured out. When they do return do not expect a tidal wave of fresh properties re-entering the market but a slow to moderate increase.

If you have been waiting to get into the market indications are the time has come to take action. There are still good values and interest rates are comparatively low when. Don’t be the one who says I wish I would have… There is already plenty of that happening today with those who passed on last year’s opportunities.    

#centraloregon, #bendoregon, #dukewarner, #billpanton, #shopbendhomes

Oregon Supreme Court Decision a Game Changer

Yesterday the Oregon Supreme Court handed down its ruling on the validity of MERS participation in a property foreclosure. The high court’s opinion appears to favor the lenders and should mark a return of the lenders pursuing non-judicial foreclosures.

For those who have not followed the mortgage/distressed property scene, MERS is a entity created by some of our nation’s largest banks to assist in parsing mortgages into palatable pieces that are re-engineered into saleable securities. The issue resolved by Oregon’s highest court was whether or not MERS could act on behalf of the lenders in a foreclosure proceeding. It was contended that since MERS was not named in the original

loan documents they had no rights for pursuing a foreclosure on a distressed property. The high court has opined that MERS may not initiate the foreclosure action but they can participate in its execution.

In Oregon a lender has two methods of foreclosing on a property. Previously the most popular and least painful for all parties concerned was the non-judicial process. When the MERS issue was forced to the high court, lenders pulled out of non-judicial foreclosures at a record rate. Lenders then switched to the more lengthy and involved process of a judicial hearing to resolve the foreclosure. The foreclosure process when combined with the legislations creation of SB 1552 that allows for distressed property owners and their lender to mediate a solution was brought to a screeching halt. This in turn helped create a void in the amount of properties available for sale.  

Today there are five bank owned properties actively listed for sale in the Bend real estate market. There are another five bank owned properties that are pending sales. It will be interesting to see how long it takes the lenders to refill the pipeline. At the height of the distressed market we would have 50 -70 bank owned properties on the market. I do not expect those numbers to return but for awhile I think that it would be plausible to see 25 – 40 properties available for sale.

Another interesting affect will be if distressed property owners feel more obligated to attempting a short sale. These numbers have also dropped off dramatically with only twelve homes actively available for sale in our multiple listing service, another twenty six have offers but are accepting back up offers and a whooping sixty three that awaiting the determination of the lender to their worthiness.  

   

Considering how ineffective lenders are at moving through their processes quickly, I would not expect a big surge of distressed properties in to the active market but a more methodical and consistent filling of the pipeline. This would complement our recovering market quite nicely and add balance to our topsy turvy world.