U.S. home prices have increased for 13 straight months rising 10.5 percent in March compared with a year ago — the biggest jump since March 2006. Oregon’s home prices have increased 14.3 percent.
According to Bend Oregon Real Estate Expert report bank foreclosures in Bend are becoming a thing of the past. As of this posting there was one bank owned residential property for sale in Bend, priced at $1,650,000. Prices of homes in Bend are steadily climbing and interest rates are at an historic all time low.
A recent report in the Associated Press suggested there are not enough qualified people to undertake a construction boom.
Some builders offer that they are probably only hiring about 75 or 80 percent of what they actually need. U.S. builders and the subcontractors they depend on are struggling to hire fast enough to meet rising demand for new homes.
The shortage of labor ranges across occupations — from construction superintendents and purchasing agents to painters, cabinet makers and drywall installers. The National Association of Home Builders says its members have complained of too few framers, roofers, plumbers and carpenters.
In 2006, when the boom peaked, 3.4 million people worked in homebuilding. As of last month, about 2.1 million people were employed in residential construction.
For now, the industry is building faster than it’s hiring. In February, builders began work on single-family homes at the fastest pace in five years. And in March, new home construction broke the one million mark for the first time since June 2008. Permits for future construction are also near a five-year high.
While boom may not be the perfect description of the building activities in Central Oregon, it’s clearly a shot in the arm for our economy as we see new homes being built just about everywhere from smaller fill-in housing to larger custom homes on Bend’s westside.
At least by today’s standards the new construction appears abundant and noteworthy. But will it last? Is it just a correction? Should we be steadfastly optimistic or cautious?
Bend’s Tetherow development has reported a resurgence of individual lot sales and new home construction, with 2012 seeing a 200 percent rise in the number of lots sold, and a number of custom and spec homes are currently under construction, bolstered by upcoming activity including construction of a new 50-room lodge.
And it is a similar story at other destination resorts in the region, including Brasada Ranch and Pronghorn, which have also seemingly emerged stronger after challenging times and ownership switches.
Bend’s NorthWest Crossing neighborhood also continues to be a poster child for thoughtful master planned development while building on strong interest among homebuilders, even notching annual sales increases through the recession.
Testimony to the surge in custom home building is a new venture, named CW, with construction specialist Charles Cushman, architect David Waldron and interior designer Veronique Waldron, with the multi-faceted team offering to produce custom residential. The group is upbeat about “the timing of their venture, the financial climate and the positive aspects of the environment and market in Bend. (see story this issue)
Another example of how the custom home process is working is a recently completed residential project in North Rim by Sun Ridge Building Co. led by Jack Tebbs. North Rim is a 200-acre Brooks Resources development with 122 one-acre or more homesites on the northern flank of Awbrey Butte
In this issue Simon Mather goes into to detail how this $3 million project was initiated when the market was down, which shows there was still a demand for quality high-end custom work even in challenging times.
As the future looks brighter on the custom home horizon and vacant lot inventory winds down, developers are tentatively looking at opening up new residential areas, including 43 new home lots added on a former driving range site on Bend’s River’s Edge golf course, which could be triggered if market prices continue to climb.
The housing market is steadily improving, but let’s not mistake this for a boom. The gains in activity and prices are coming as a welcome relief, but our homes are still not even close to their former values. You might feel good about progress in home prices, but keep in mind that the value of dollars received from a sale will be less than when the home was purchased.
If you construe the recent improvements in home sales and rising prices as a return to the boom times of a few years ago you might be disappointed. Economists offer that most areas should see some improvement in 2013, but concerns over continued partisan politics in Congress have most experts suggesting: ‘a sluggish recovery might be the most optimistic projection.’
