HOUSING
Central Oregon’s Housing Woes
I
t has been well documented that in Central Oregon, particularly Bend, housing is in short supply. According to data from the Multiple Listing Service analyzed by the Beacon Appraisal Group we see that available inventory of residential real estate has remained below a single month since spring of 2020. That is very low. Generally, six months of inventory is associated with moderate home price appreciation. Levels below that have led to our very rapid home price appreciation over the past six months. The lack of available housing on the market is not unique to us
here in Central Oregon. Nationally, months of supply dropped to a record low of 1.9 in December 2020. The pandemic is to blame for much of these supply issues. Generally, geographic mobility has been reduced, leading to less churn amongst owners of existing homes. Moving during a pandemic can be stressful if you are in a vulnerable population and fewer are moving for work/ career reasons due to many jobs remaining remote for the time being. Additionally, historically low mortgage interest rates ramped up demand for residential real estate.
32 | Southern Oregon Business Journal June 2021
Home prices have responded to this low supply and high demand environment. According to Zillow’s home price index, home prices rose roughly 8% nationally in 2020, compared with 3.3% in 2019. Deschutes County’s home prices rose a staggering 12.7% in 2020 compared with 3.7% in 2019. Perhaps more shocking is the fact that Zillow estimates that roughly 63% of the home price appreciation in Deschutes County over the past year happened since the end of summer. When we see dramatic increases in valuation like this affordability becomes a major concern,
