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Februa
March 1st, 2006
Experts in the Central Oregon real estate
market are predicting another record-breaking year as home and land prices
continue to soar with no end in sight.
“People ask me if there’s going to be a
housing bubble in Central Oregon in 2006 and I say yes,” said Dana Bratton of
Bratton Appraisal Group. “We’re going to see home values increase an average
of $50,000 to $60,000 in value this year.”
The lack of inventory is driving the market
with the median home price in Bend expected to reach $360,000
before the year ends. Apartment
construction has been flat for the
past three years and the inventory has
been reduced. As interest rates continue
to
go up and
more first-time buyers
are
squeezed out, apartments are
going to be more and more attractive. You’ll
probably see a $50-$75 increase in rents in 2006.
Industrial land investment in Redmond or
Prineville where lucrative enterprise zones are attracting new businesses are
also speculated as good investments.
Prineville is the No. 1 place where Bend
residents are relocating with 242 households moving east. The biggest
percentage of increase in home sales and lots in Crook County where real estate
prices went up 70 percent in 2005. Light industrial land will continue to sell
at a premium with very little inventory remaining in Bend. The migration of
light industrial businesses will continue to push toward Prineville and Redmond
with strong job growth in both cities.
There is currently a one or two year inventory
of land available in Bend under the Urban Growth Boundary. City officials have
been challenged to expand the boundary by 2007. Despite the shortage of land,
it was predicted that 2,000 new homes would enter the Bend market in 2006 with
Palmer and Pahlisch Homes approaching 200 units.
The homebuilder that constructs 5 to 25 units a
year is starting to go to Crook and Jefferson counties. They can’t compete with
production builders because of rising land costs and remain profitable.
Talk of a housing bubble is heard daily but the
track record of the national housing market for investors has been a steady six
percent appreciation in real estate nationally since 1968, and this year, it’s
predicting 8.9 percent. The inventory has pushed the median price in Bend to
$328,000 and it’s only going to continue to go up.
One realtor’s best real estate
picks include homes with small acreage, river view homes and 20-30 year-old
homes that are being purchased and torn down. Homes in these categories are
generally on the market less than 30 days. 1031 Tax Exchanges with investment
for investment buying and selling has become a very popular form of buying and
selling real estate in Central Oregon
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