August Market Update

Bend’s overall months of supply is trending right above 3 months, which is at a post-COVID era all-time high but still below our average pre covid levels. However, when the high-end market is isolated our months of supply are over 5 months and growing.  Is this a sign that the cash buyer/luxury market is slowing down as economic news continues to flash new warning signs about the strength of our economy? 

Bend’s median list price on pending homes is considerably down.

The pending median price of a Bend home in July came in at $715K, which is substantially down from last month’s red-hot number of $799K.  Interest rates have been on an upward trend lately with rates now hovering at or above 7% for over a month, putting affordability pressures on Buyers.  With inventories on the rise and pending listing prices down, there is a high likelihood that we will see some softening in the median sales price in the next two months.

Financing affordability in Bend is at another record low.

Based on our current median sales price and interest rates our affordability metric is at an all-time low. Our monthly payment index is at $4200 (not including taxes), for buyers financing a median sales priced home with 20% down.  This is approximately a 20% INCREASE from where we’ve been tracking for the last 12 months!  Can the market sustain a rapid 20% increase?

Thoughts for Buyers

Given that we typically see a slowdown in demand from the end of August through early September and that inventories are creeping up there, I think now is a good time for buyers to enter the market and shop fordeals.  This repeatable, seasonal slowdown often creates some capitulation with sellers who are not expecting the slowdown, which leads to unnecessary price reductions, and opportunity to negotiate on price.  Even though it feels like the market does need a slight correction I would still be shopping if I were a buyer, however I might be a bit more selective on properties, and I would be willing to take a risk on a lower offer price.  Keep in mind that the killer properties are still worth the value and will still sell fast.

Thoughts for Sellers

If your home is currently on the market, have patience from late August through early September, as historically there is always a pause in the market during these months.  If you are just now thinking of listing and will not have your home on the market within the next 2 weeks, then I would consider a pause.  Use the time to prepare your home and shoot for listing in mid-September.  It is time to be aggressive on price and do not try to push towards the upper end of the market, as we are exiting the hyper-competitive buying season, and with rates and prices near all-time highs, it is best to play it conservative on price.