Migration to booming ‘Zoom towns’ in Pacific Northwest sends home prices into overdrive

19204 Gateway Loop, Bend, OR 97702
Presented by The Ladd Group | Offered at $870,500 | MLS# 202003108

From nwnewsnetwork.org

“Zoom towns”, a new term that you can add to your lexicon. These are scenic places experiencing a surge of house hunters. Booming demand comes from workers freed by the pandemic to work from home long term. One place where the pandemic has charged greatly, an already hot real estate market, is Bend, Oregon.

“I think ‘Zoom town’ very accurately captures the experience that we’re having right now,” said Brian Ladd, a Principal Broker with Cascade Sotheby’s International Realty in Bend.

“For anyone that had interest in moving to a town like ours, that plan was greatly accelerated because of COVID,” Brian Ladd said in an interview over Zoom. “When they were able to work remotely, or they were forced to work remotely, all of a sudden it became an option.”

Brian Ladd’s observations are shared by brokers in some outdoorsy, vacation destinations around the Pacific Northwest. Zoom towns could include Sunriver and parts of the Oregon Coast besides Bend.

The housing market nationwide has shown remarkable strength in 2020, driven by low-interest rates and desire among buyers to acquire more elbow room. What distinguishes the Zoom towns is strong in-migration this year from larger locales. At these destinations, home sales since late spring have gone on a tear, resulting in very low inventory and rapidly rising housing prices.

In Bend and surrounding Deschutes County, the average residential home price in October was up 17% year over year. The median sales price in October in Bend was $560,000. Brian Ladd said the average number of days on the market for desirable homes to go pending is around five days, which means many homes get multiple offers.

“What it felt like is it really unleashed a whole wave of people who had had the dream of moving and living in a beautiful place like this, and it seemingly all happened at once,” said Brian Ladd.

Full article on nwnewsnetwork.org

Fannie Mae and Freddie Mac Baseline Limit Will Increase to $548,250

654 View Rd, Florence, OR 97439
Presented by Jack Winter | Offered at $1,550,000 | MLS# 20-1885

From nahbnow.com

The Federal Housing Finance Agency (FHFA) announced on November 24, 2020 that the maximum baseline conforming loan limits for mortgages acquired by Fannie Mae and Freddie Mac in 2021 will increase to $548,250 from $510,400.

The loan limit will rise 7.42% in 2021 because FHFA has determined that the average U.S. home value increased by that amount between the third quarters of 2019 and 2020.

Higher loan limits will be in effect in higher-cost areas as well. The new ceiling loan limit in high-cost markets will be $822,375. The previous ceiling was $765,600.

What does this mean for homebuyers?

The increase keeps homebuyers in step with a more expensive housing market by allowing them to borrow more to the limit of what is called a “Conforming Loan”. With conforming loans, buyers can purchase homes with lower down payments and more competitive rates.

Full article on nahbnow.com

October existing-home sales see ‘spectacular’ 26.6% annual gain even with short supply and surging prices

8585 SE 242nd Ave Damascus, OR 97089
Presented by Veronica Park | Offered at $4,800,000 | MLS# 19657180

From cnbc.com

According to the National Association of Realtors, sales of existing homes in October soared to 4.3% compared with September, as well as a 26.6% annual increase to an adjusted rate of 6.85 million units.

NAR’s Chief Economist, Lawrence Yun, called this “a spectacular gain”. To him, the surge in sales in recent months had offset the spring market losses. And with the news of having a COVID-19 vaccine will soon be available, and with mortgage rates projected to hover around 3% in 2021, he expects the market’s growth to continue into 2021. Yun forecasts existing home sales to rise by 10% to 6M in 2021.

Based on the report, there were 1.42 million existing homes on the market at the end of October, a 19.8% drop compared with October 2019. At the current sales pace, the data represents a 2.5-month supply, the lowest on record.

NAR also said that the median price of an existing home sold in October was $313,000, up 15.5% annually. That is the highest median price on record and reflects the far stronger sales on the higher end of the market.

Danielle Hale, Chief Economist at realtor.com, mentioned that while the rising coronavirus cases could dampen sales, mortgage rates could tick up in the months ahead and test the strength of this seemingly unstoppable housing market.

On another note, investors continue to be strong in the market. The severe shortage of existing homes for sale has been incredibly beneficial for the nation’s homebuilders, who have seen very strong demand. Mortgage applications to purchase newly-built homes were up nearly 33% annually in October, according to the Mortgage Bankers Association.

Full article on cnbc.com

The COVID-19 Effect on Bend’s Real Estate Market

Written by: Laura Blossey

11750 NE Canyons Ranch Drive Terrebonne, OR 97760
Presented by Laura Blossey | Offered at $4,500,000 | MLS# 220111416

Bend, Oregon is the epitome of COVID-19 accelerated real estate sales. After only a few weeks’ pause in March from new restrictions, out of town buyers doubled down on Bend as the perfect escape from their respective cities. After evaluating the quality of life and relatively lower cost of living in Bend compared to our feeder markets like the Bay Area and Orange County/ LA, for example, Buyers have been even quicker to move here in the second half of 2020 than in past years.  Why Bend? Buyers are choosing Bend over other markets for many reasons, including the year-round outdoor lifestyle (skiing, hiking, mountain biking, kayaking on the rivers & mountain lakes, golf, horseback riding & more), easy direct flights to West coast markets for ease of visiting clients and friends & family, luxury amenities with a laid back lifestyle, and an overall better quality of life. Bend is the perfect escape from restrictive or chaotic worlds.

COVID-19 set the precedent for working from home, so people started asking themselves, why not work from home in another city? It’s now common for lenders to ask for written proof from Buyer’s employers that the Buyers can indeed work from home in Bend. Contingent purchases are more commonplace as Buyers are willing to put their homes on the market the minute they write an offer on a home in Bend, but even more so cash offers are dominating our sales. Bend has recently been named by WalletHub as the second-fastest growing city in the nation, with COVID-19 clearly a contributing factor.

Examples showing the accelerated growth in Bend since COVID-19 based on sale prices and days on the market (DOM) abound. One of my listings in a desirable neighborhood sold for $905,000 in April, 2020 after 171 days on the market with 2 price reductions. A home on the same street with almost identical specs is currently pending in just 10 days. Listings at all price points have yielded multiple offers – as many as 22! – and are selling for up to $200,000 over asking price which is a new phenomenon in our market since COVID-19.

This graph depicts a sharp increase in median price in 2020 compared to past years during June through September across multiple years. From just the same period a year ago, we saw a 2% decrease in median price in 2019 compared to an 18% increase in 2020. We will continue to be in a strong Seller’s market until new inventory can catch up with demand, but since most people don’t want to leave Bend we’ll rely on new construction to fill the gap.

Sales of Million-Dollar Homes Double in a Year

12900 Beck Rd Dallas, OR 97338
Presented by Julie Halter, Joe and Stephanie Reitzug | Offered at $3,900,000 | MLS# 20659293

From Realtor Magazine

Home sales are skyrocketing during the pandemic, but the most dramatic increase is happening at the top of the market. Sales of homes costing $1 million or higher have doubled since last year.

Based on NAR reports, home sales in luxury vacation destinations have increased since July by 34% year over year in September.

With the pandemic causing work and school to be done at home, people who are financially secured are more compelled to look for a bigger or spacious home. This is cost-effective as mortgage rates are still at record lows.

Home prices are still rising as buyer demand remains high and inventories low. Based on NAR reports, sales for homes with prices ranging from $250,000 to $500,000 increased in September by 36%. The median home price last month reached a record high of $312,000, which is an increase of 14.8% from a year ago.

Full article on Realtor Magazine

WalletHub names Bend 2nd fastest growing city in the US

61794 Tam McArthur Loop Bend, OR 97702
Presented by Tebbs & Little Group | Offered at $3,899,000 | MLS# 220102501

From Central Oregon Daily

According to WalletHub’s recent report on 2020’s Fastest Growing Cities in America, Bend ranked second next to Fort Myers, FL.

WalletHub is a personal finance website that compares 515 US cities across 17 key metrics to determine where the most rapid local economic growth occurred over a period of seven years.

The factors considered in the release of this report ranges from population growth to college-educated population growth to the unemployment rate decrease.

Furthermore, WalletHub produced a separate ranking by city size.

Bend topped the report’s rankings for “mid-sized” cities, ahead of Meridian, Idaho, Enterprise, Nev. and Frisco, Texas.

Economic Growth in Bend (1=Fastest-Growing; 258=Avg.):

  • 11th – Population Growth
  • 43rd – Median Household Income Growth
  • 1st – Job Growth
  • 263rd – Poverty Rate Decrease         
  • 10th – Regional GDP Growth
  • 163rd – Unemployment Rate Decrease
  • 1st – Growth in Number of Businesses
  • 11th – Working-Age Population Growth
  • 87th – Median House Price Growth

Full article on Central Oregon Daily

Builders Ramp Up Construction to Meet High Demand

26480 SW Wilken Ln West Linn, OR 97068
Presented by Kristen Kohnstamm | Offered at $5,750,000 | MLS# 20126915

From Realtor Magazine

Homebuyers continued to surge the new-home market that explains why builders increased the construction of single-family homes in August. The pace of single-family starts last month reached its highest level since February, just before the COVID-19 pandemic ignited across the U.S.

Based on the report from the Commerce Department, single-family rose by 4.1% in August to a seasonally adjusted annual rate of 1.02 million. Meanwhile, homebuilder sentiment last month rose to an all-time high as builders felt optimistic about current and future sales.

However, rising lumber costs could threaten to price more homebuyers out of the new-home market over the coming months, according to National Association of Home Builders’ Chairman Chuck Fowke and Chief Economist Robert Dietz. Low mortgage rates are helping to offset the rising costs somewhat.

Overall, housing production in August dropped 5.1% due to a double-digit decrease in the multifamily sector. Construction of apartment buildings and condos plunged 22.7% to an annual pace of 395,000 units. “Total housing starts were down in August on a decline for multifamily construction, with multifamily 5+-unit permits now down 8.3% on a year-to-date basis,” Dietz explains. “But low interest rates and solid demand are spurring single-family construction growth, which makes up the bulk of the housing market. Single-family permits continue to rise as well and are now up almost 7% on a year-to-date basis.”

Regionally, combined single-family and multifamily housing starts were highest in the Midwest, increasing 13.6% on a year-to-date basis, followed by a 5.4% increase in the South and a 3.8% increase in the West. Housing production, meanwhile, was 4.5% lower in the Northeast last month.

Full article on Realtor Magazine

July Pending Home Sales Jump Over 15% Annually, as Properties Go Under Contract in Record Time

29103 NE Lookout Rd Camas, WA 98607
Presented by Martiné Gibbons | Offered at $4,950,000 | MLS# 20190459

From cnbc.com

Homebuyers continue to show strong demand and prove that there isn’t a summer slowdown despite the Covid-19 pandemic.

According to the National Association of Realtors, pending home sales, which measure signed contracts to purchase existing homes, increased 5.9% in July compared with June, and sales were 15.5% higher annually.

NAR’s Chief Economist Lawrence Yun said, “Home sellers are seeing their homes go under contract in record time, with nine new contracts for every 10 new listings.”

Yun does not expect sales to drop or become slower this fall season. He anticipates existing-home sales to reach 5.8 million in the second half of this year. This would then bring the full-year total to 5.4 million, showing a 1.1% increase compared with 2019.

Based on NAR’s index, the housing market activities from pent-up demand is in good shape. Pending home sales in the Northeast rose 25.2% for the month and were up 20.6% from a year ago. In the Midwest, sales rose 3.3% monthly and 15.4% annually. Sales in the South increased by 0.9% for the month and were up 14.9% from July 2019. Sales in the West rose 6.8% monthly and 13.2% annually.

“Anecdotally, Realtors are telling me there is no shortage of clients or home seekers, but that scarce inventory remains a problem,” Yun said. “If 20% more homes were on the market, we would have 20% more sales, because demand is that high.”

July sales of newly built homes, which are also measured by signed contracts, surged dramatically, as buyers are now looking for new, high-tech, smart homes with floor plans designed for working and schooling at home. Builders are also benefiting from the severe shortage of existing homes for sale.

Full article cnbc.com

Existing-Home Sales Surge 24.7% as Prices Soar to Record

910 Northshore Rd, Lake Oswego, OR 97034
Presented by Matt Tercek | Offered at $4,595,000 | MLS# 20019782

From newsmax.com

U.S. home sales increased for the second straight month in July and home prices also hit a record as low-interest rates increased the demand for homes even if the coronavirus pandemic put millions of people out of work.

According to the National Association of Realtors, existing-home sales rose by 24.7% to a seasonally adjusted annual rate of 5.86 million units last month. Data for June was revised slightly to a 4.70 million-unit pace from the originally reported 4.72 million.

July’s rise was the second consecutive increase, followed soon after a monthly increase in June, and raised the sales pace above the 5.76 million pace in February before the pandemic caused a momentary drop in sales. July’s level was the highest since December 2006.

“The housing market is well past the recovery phase and is now booming with higher home sales compared to the pre-pandemic days,” said Lawrence Yun, NAR’s chief economist. “With the sizable shift in remote work, current homeowners are looking for larger homes and this will lead to a secondary level of demand even into 2021.”

Economists surveyed by Reuters had projected sales rising 14.7% to a rate of 5.38 million units in July.

Existing home sales, which make up about 85% of U.S. home sales, increased 8.7% on a year-on-year basis in July.

The 30-year fixed mortgage rate is at an average of 2.99%, hovering near levels last seen in the early 1970s, according to data from mortgage finance agency Freddie Mac. Data earlier this week showed homebuilding surge by the most in nearly four years in July.

Housing has been a bright spot in the economy even as other sectors suffer amid widespread coronavirus infections that have slowed commerce and kept unemployment high. More than 28 million people were collecting jobless benefits at the end of July.

The pandemic steered the economy into recession in February, ending a record-long expansion that had brought U.S. unemployment to a 50-year low.

Home sales rose in all four regions in June.

There were 1.5 million previously owned homes on the market in July, down 21.1% from a year ago. The median existing house price increased 8.5% from a year ago to a record of $304,100 in July.

At July’s sales pace, it would take 3.1 months to exhaust the current inventory, down from 4.2 months a year ago. A six-to-seven-month supply is viewed as a healthy balance between supply and demand.

Full details on newsmax.com

Cascade Sotheby’s International Realty Tops Market Share in Cannon Beach

CANNON BEACH, OR. (August 13, 2020) — Two recent oceanfront sales in Cannon Beach increased Cascade Sotheby’s International Realty market share to 26%, ranking as top firm in Cannon Beach by sales volume from January through July.

Within the first month of joining the firm, broker Jenny Rapp brought the buyer for 158 N Larch Street, a captivating oceanfront home listed by real estate veteran Sally Conrad. The home sold for $2,195,000 on July 31st.

“I attended a special open house hosted by Sally Conrad. She made sure we met the builder who explained the unique aspects of the construction. Having this detailed knowledge of the home was key as I described it to a customer who walked into our Gearhart office.” Jenny Rapp explained. “Having the stories to share about the history of the home helped my client feel connected to the property right away.”

On June 30th, another oceanfront home listed by Sally Conrad, 288 W Gulcana Ave, sold for $1,895,000. Located on the north end of quiet Tolovana Park, this exceptional home has both ocean and mountain views.

Cascade Sotheby’s International Realty boasts dedicated divisions serving Farm, Ranch and Vineyard and new development properties. The firm continues its innovative approach and continues to build upon these statistics:

  • 350 brokers;
  • 15 offices serving The Pacific Northwest;
  • $1.7 billion sales volume in 2019 – a company record.
  • 2X amount of sales volume generated versus the nearest competitor in Central Oregon
  • 51% market share growth in Portland Metro in 2019 over 2018;

•     49 brokers increased their business by at least 50% in 2019.

The firm’s affiliation with Sotheby’s International Realty offers a global referral network with over 23,000 sales associates in 1,000 offices, located in 70 countries. In 2019, $114B in sales was generated worldwide. The Sotheby’s International Realty network and effective advertising programs allow properties in Oregon and SW Washington to be thoughtfully marketed into key buyer feeder markets that include cities in California, Washington, and Arizona.