Once again history is repeating itself in the Bend real estate market this year. Historically January is the low point for home sales and February is the low point for inventory. Continuing this trend means that the number of home sales should rise through July and inventory should peak in August.
Looking at daily activity to date in March it is clear that real estate activity is picking up. Unfortunately, the Bend MLS doesn’t offer summary totals for new listings and homes sold until the month has ended but our informal observations indicate the number of new listings in March should be close to double the new listings in February. Pending sales also appear to be rising and it will be interesting to see, when the numbers come out in April, if inventory is has kept up with demand.
One thing that could provide a nice boost to inventory this year is if investors decide to take advantage of rising home prices. The Bend real estate market appears to be in a good place for investors to take some profits with the average price per square foot of homes sold having risen 44% ($112 to $163) since it bottomed out in March 2012. Investors will surely be tempted to sell and lock in those gains. On the flip side of the coin, residential rentals have been performing extremely well with little to no turnover in tenants and that consistent income could be enough to keep investors from selling. It is easy to sell an asset that is under performing but difficult to sell when nothing is wrong.
One thing that could keep inventory down this year is home buyers returning to the real estate market. Here at Preferred Residential we are seeing more of our tenants exploring their options to purchase a home than we have seen in years. Odds are that we aren’t the only property management company in Bend experiencing this. If this is true then not only would this influx of home buyers keep the number of homes for sale low they could drive prices higher. They key is whether or not these renters will qualify for a mortgage. Our experience has been mixed with some who lost their homes to foreclosure able to qualify and others struggling to come up with a down payment. The good news is that these folks are finally starting to feel like home ownership is once again an attainable goal.
*Sales data courtesy of Bend MLS