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In the ever-changing landscape of Central Oregon’s residential real estate market, active practitioners in the industry anticipate a transition to a more balanced, stable environment as 2026 gets fully underway, with steady price appreciation rather than sharp price hikes.
While Bend remains relatively high priced, innovative approaches are providing prospective buyers with more options — though elevated interest rates and, in some cases, limited affordability continue to impact demand.
Susanna Abrahamson, local Central Oregon broker and current president of Cascade East Association of Realtors (CEAR), said we were coming off the “highs of the COVID-19 era.”
During that timeframe (2020-2022) the market, in Bend in particular, surged due to a massive influx of remote workers, historically low mortgage rates, and a severe, pre-existing housing shortage. These urban buyers sought lifestyle changes, driving, high demand, multiple offers, and record-low inventory.
The situation was compounded by a shortage of construction as local demand far outpaced the ability to build new homes, creating a long-term supply deficit.
Abrahamson said, “A lot of people were moving here and working remotely, but thankfully, the market has transitioned from that frenzied pace to a new, albeit higher-priced, equilibrium, though demand remains strong.
“Interest rates obviously are elevated now compared to the unprecedented lows of recent history but are still reasonable compared to the overall historical picture.
“Higher-end properties are still seeing strong interest, but in terms of new building, we need more single-family options matching what residents want.
“The problem with a lot of resort towns is that people live here but don’t necessarily work here, and we see the need for more stable workforce housing to allow the opportunity for people to live and work in the same community.
“Entry-level prices in Bend are currently hovering around $475-$500K, but Redmond is somewhat lower and if people are prepared to move to outlying communities like La Pine and Prineville to get a foothold, there are opportunities to consider.
“Prospective homeowners need to get creative to get on the property ladder, and there are more options nowadays, including the move toward cottage-style developments, and more townhomes — encouraged by the state-led effort to encourage more density.”
Hiatus Homes in Bend is one example of developing “pocket neighborhoods” of small, energy-efficient cottages (approx. 400-600 sq. ft.) and twinhome units designed for sustainable, community-focused living. They focus on high-quality, net-zero-ready designs, often combining a main home with an accessory dwelling unit (ADU) to create “missing middle” housing.
Cottage-style developments similarly offer increased affordability through smaller footprints, shared common spaces, and efficient land use, often serving as a bridge between single-family homes and apartments.
These projects frequently use cluster zoning to reduce infrastructure costs and, in some cases, community land trusts to keep homeownership accessible at or below 80% of the area median income. Ownership models like community land trusts (where a nonprofit owns the land) ensure more long-term affordability.
In terms of Central Oregon market dynamics, home prices in areas like Bend and Redmond appear to be holding firm, with experts projecting gradual appreciation rather than massive gains.
Inventory has increased, reducing the fierce competition of previous years, though desirable, well-located homes still move quickly, and the buyer/seller landscape is changing to a more balanced market, where sellers need to price strategically, and buyers have more room for negotiation.
Matt Johnson, a principal broker with The Johnson Group at REMAX/Key Properties, said, “Demand is still relatively strong in Central Oregon, with different markets within the Tri-County area having different dynamics.
“Sales data for March this year shows sales are up year-over-year, while time on market decreased, showing that if properties are priced right, they will sell.
“The average sales price in Bend is around $750,000, which is obviously vastly different from the dips of 2008/2009, but Bend is a different place now.
“Overall, we are seeing a pretty balanced market, though people who were appearing to come off the sidelines may be hesitant currently until the geopolitical picture becomes clearer and less uncertain.
“There is still a lot of catching up to do in terms of new construction, which lagged behind for so many years, and population levels are still increasing. The affordability question is highlighted by the fact that the first-time homebuyer average age is now around 40 years old.
“There are still a lot of homeowners sitting on those 3% interest rates they locked in several years ago that just can’t afford to sell, as rates have pretty much doubled since then.
“Overall, we do see more stability in the Central Oregon market, and I do like, for example, Redmond, as homes there offer a little more bang for the buck to go along with the industrial activity, the regional airport, a revitalized downtown, and more land available to be developed.”
Key regional trends include median home prices in Bend remaining high (around $713,000-$798,500), reflecting strong long-term desirability, while Redmond remains a more affordable alternative, with tighter inventory levels that often favor sellers.
While mortgage rates remain elevated, some buyers are entering the market as options increase, and the outlook for the region continues to be a highly desirable location for lifestyle-driven buyers and remote workers, supporting sustained demand.
Pricing strategy and timing will continue to be key for both buyers and sellers in 2026, while sustained demand, coupled with limited developable land in some areas, suggests continued long-term value, with experts predicting moderate appreciation.
