Joined: 26 May 2006
|Posted: Mon Jun 23, 2008 6:31 pm Post subject: Bend Housing Market 2nd Highest in U.S. 2nd most overvalued
|This was posted by DANIEL PEARSON CBN Editor
A new study released by a national real estate analyst group finds that Bend’s housing market was the second most overvalued market in the U.S., behind only Atlantic City, New Jersey, out of 330 cities studied and that as a whole the Pacific Northwest is “precariously overvalued and likely to be the next shoe to drop."
The housing valuation analysis, released by Massachusetts-based Global Insight, says the average home price in Bend runs about $290,500, which is overvalued by 49.5 percent, a slight decrease from first quarter 2007 when median home prices reached $319,900 and were overvalued by 65.7 percent, the study says.
In other words, the study claims a house in Awbrey Butte appraised at $500,000 is really worth only $250,000.
At least one local real estate observer says that is ridiculous.
Bill Robie, director of government affairs for the Central Oregon Association of Realtors, said the results of the study, and others like it that are released from time to time, are misleading because the methodology leaves out huge chunks of information that need to be considered when determining market prices – land permit fees, system development charges, the time it takes to build and the price of the land where the house will be built, to name a few.
“These kinds of statistics have come out before and they do not take into consideration the many local factors that contribute to Bend’s housing market prices,” Robie said.
Bend traditionally has a lot of second home buyers and wealthy retirees in the market who can afford more expensive homes
HOGWASH Mr. Bill Robie
Ya think those making 12 bucks per hour care what fees these greedy contractors have to pay, or what the local government hacks charge for building permits etc? These contractors have built hundreds of homes in the Bend area, so close together, that almost lean on each other, literally shadowing each other.
Mr. Robie must not realize, it was the areas of second homes that are getting hit the worst in this housing down turn, where even the well off have to adjust down, dumping those "second homes" as the economy sputters.
In addition, those hundreds of homes these developers have built for supposdly the middle class in Bend, have been built so close together the occupants are staring at each other through their windows, listening to each others conversations, with postage stamp back yards... Yet these homes are still going for 275,000 to $350,000. Where is the income in Bend to support these so called middle class prices?
The answer? The income will not support it, and it will be increasingly difficult for those in these homes to make the payments.
Unfortunately, like everywhere else, the pain of watching home prices come down, is here.
One other thing, the era of Californians moving out of state with wheel barrels full of real estate money, is quickly coming to an end, as the prices there have dropped dramatically.
Mr. Robie seems like a typical real estate agent with their sales commission being their top priority. The reality is, real estate agents like everyone else, will be taking a hit.