Oregon Public Broadcasting

It’s not unusual this time of year to see housing prices take a bit of a dip.  But in Bend last month, that regular cyclical decline pushed the city’s housing market into new territory. 

David Nogueras / OPB

The median price of a single family home is now the lowest it’s been since the market peaked in 2007.  But while some see that statistic as a reason for despair, others see it opportunity.

The living room of Nicole Strong’s 2000 square-foot, 4 bedroom craftsman on Bend’s west side is warm and inviting.  The first-time home buyer decorated the walls with art she brought back from South America. 

The house was previously owned by an LLC -- or limited liability company.  Strong bought the house in a short sale last August.

It was definitely a fixer-upper, she says.   The previous tenants were a half dozen college-age boys.  And judging by the condition of the place when she moved in, they didn’t exactly treat the house with loving care.

“For example the hose had been become detached from the dryer in the laundry room which is a 10 second fix, you move the dryer and you put the hose back on, but instead of doing that they just let the dryer blow lint into the laundry room, all over the walls, into the guest bathroom.  It was just a sticky, dirty, filthy, nasty mess,” Strong said.

The former tenants behaved in ways that weren’t exactly popular with neighbors, either.  Someone showed Strong video tape of the young men taking turns snowboarding off the roof.

So it’s a little surprising to hear Strong say she neighbors weren’t completely thrilled to see her move in.

“I think some of them looked up what I got the house for and it’s less then half of what they paid for their homes in the same neighborhood, so I think that’s a little bit of a knife in the chest for them.”

But first time home buyers, like Strong, have an advantage in this market.  According to the real estate data company CoreLogic, 1 in 5 homeowners across the country owe more than their houses are worth. 

That means many people are stuck in their homes.

But for those that can afford it, a good deal can be difficult to pass up.  

Mia Maccollin is exploring a foreclosed property in what’s known as Old Bend.  She’s one of the first on the scene  -- just hours after the “for sale” went up.

Maccollin works at the Humane Society.  She and her husband already own two houses, one of which she says is worth just two-thirds of what they paid for it.  Still, she’s planning to take money out of the stock market to buy what would be their third house.

“This is going to sell instantly and if it’s something that we could fix up, we would buy it tomorrow.”

By Maccollin’s telling,  the competition for distressed properties has been fierce.  She points to a foreclosure that went on the market recently just a few blocks away.

“It sold within a week with four offers in cash.  And another one around the corner, I think it’s on Broadway, sold before I could even call them.  There’s another foreclosure down here, it’ must be on Delaware also, also sold before I could even call them.  So things are definitely going up.”

Bonnie Savikas is a Bend-based Real Estate Broker with Caldwell Banker Morris.  She says she’s also seeing bidding wars - particularly in properties priced under $200,000.

That’s got some of her clients worried they’re not being aggressive enough.

“There’s a lot of multiple offers going out on the lower end, and once they’ve lost out on two and as many as three they get a little bit where they think maybe I should just settle.”

But despite seeing what she calls flurry of activity, Savikas says very few of her clients are first time home buyers.  A lot of the them are older couples from out-of-state looking forward to the day when they can afford to retire.  Most of the others, she says are investors.

But these accounts are anecdotal.

Kathy Ragsdale is the CEO of the Central Oregon Association of Realtors. 

She says if you look at the data in Bend over the last year, there isn’t much to suggest there will be a turnaround in the market.

“Although I do see more sales happening, my sense is that we’re kind of bouncing along the bottom.  We get an uptick and then we go back down again but we’re not getting lower.”

Then there’s the issue of the larger economy.  The unemployment rate has gone from a little over 4 percent here in May of 2007 to just over 12 percent last month. That’s 3 and a half points higher than the national average.

Still, that didn’t stop the website Business Insider from recently ranking Bend at the top it’s list of the 15 best housing markets around the country for the next five years.

So what role might the region’s employment situation play in a potential recovery in the housing market?  Well, one of the great ironies in the story of Bend’s housing boom and bust is that many of the people couldn’t afford to buy when prices were going up, still can’t afford to buy now that prices have plummeted.  That’s because for those who are out work, getting mortgage simply isn’t a possibility these days.