Area home values still rising
Central Oregon homeowners cashing in, upgrading homes
Published: April 12. 2006 6:00AM PST
Barbie and Mike Milichichi's sweat equity has carried them a long way in six years - with a big boost from Central Oregon's still red-hot real estate market.
Back in 2000, the Milichichis invested their own time and labor to get a big break on the down payment for their first house, a little rambler on Stonebrook Drive on Bend's east side.
The price then: $137,000. Their asking price this spring: $329,000, enough, they hope, to afford the 10-acre site with a manufactured home near Eagle Crest that they have their sights on this year.
"I would never have dreamed that prices would go this high," Barbie Milichichi said Tuesday. "But we're happy."
Despite slowdowns in the national and regional housing markets, Central Oregon home-sellers still have plenty of reason to smile this spring.
The median price of a Bend single-family home - the price at which half are higher and half are lower - reached $327,500 by the end of the first quarter this year, up 30.5 percent from the first quarter of 2005, according to the Central Oregon Association of Realtors.
The Redmond median hit $238,000, up 38.6 percent in the last year. Prices in La Pine jumped 18.8 percent, and median prices spiked 35.9 percent and 33.8 percent, respectively, in lower-priced Jefferson and Crook counties.
In one sense, it's no surprise that year-to-year numbers are up, since the last three quarters of last year brought a record-breaking surge in home prices.
But the pace of the increases has barely slowed in the first three months of this year.
Median prices in Bend have risen 6.3 percent since the fourth quarter of 2005, according to the Multiple Listing Service of Central Oregon. Redmond's prices are up 6.7 percent. In Crook County, where new subdivisions are sprouting in Prineville, the median is up 1.8 percent.
Only in La Pine, where new subdivisions also are adding to the housing stock, are prices down since the fourth quarter of 2005. The median price there has slipped about 6.5 percent to $154,000, according to the MLS. But sales volumes are nearly twice what they were a year ago, jumping from 17 homes in the first quarter of 2005 to 31 in the first quarter of 2006.
Sales volumes, in fact, are up in all of the region's major markets, despite the traditional slowness of the late-winter season.
Bend registered 485 homes sold in the first quarter, up about 4 percent from the first quarter last year. But Redmond posted 257 sales, up 35.6 percent and Jefferson County, where Madras is undergoing something of a renaissance, saw sales boom by more than 184 percent to 54.
Homes with land have seen even bigger price expansions. In Bend, homes with one acre or more sold for a median of $545,000 in the first quarter, according to the MLS, up 54.7 percent from the first quarter last year.
In Redmond, similar properties fetched a median $485,000 sales price, up 46.7 percent. In La Pine, homes with land followed the northern boom, rising 43.3 percent to $215,000.
Nationwide, existing home sales are expected to drop 6 percent this year from the record levels seen in 2005, National Association of Realtors chief economist David Lereah said Tuesday, and prices for all housing types are expected to rise modestly, despite slippage in some of the nation's biggest and hottest markets.
Nationally, Lereah is projecting a 6.4 percent price rise this year, to about $221,700.
In neighboring California, though, median prices slipped about 2 percent in February, dipping to a still sky-high $535,470, according to the California Association of Realtors.
That's still about 13.7 percent above the February 2005 California median, and the demand for Central Oregon property - driven by people selling out of higher-priced markets, and by move-up local buyers who are cashing out equities to buy bigger homes - is taking on more and more of the look of a two-sided market.
There are those who own.
And those who might never.
The Milichichis needed four years to get into their first home after they moved here 10 years ago, Barbie Milichichi said. But she and Mike, the owner of a small construction company that specializes in interior trim, found the key to their first-time house in a sweat-equity program that allowed them to save by putting their own work into the construction.
The growth in that home's value will let them buy their Redmond-area acreage, and they will refurbish the manufactured house that sits on the land now, she said. But could they afford their own house if they had to do it all over again?
"No," she said. "No."
Jeremy Graham, a stay-at-home dad, and his wife, Lisa, a chemical engineer, also are hoping to join the "move-up" market.
Their 1,850-square-foot home on east Bend's Larkview Road is on the market for $324,900, and it's attracting walk-throughs and callers "like crazy," Jeremy Graham said.
They're already set up to close on their new $450,000 house, a 2,350-square-footer on a quarter of an acre in northeast Bend's new Quail Crossing development.
The move will give their two young children more room to run, Jeremy Graham said. They're OK with the $1,100-a-month jump in their monthly payments, he said, because the move gives them the chance to lock in their upgrade "while we could still afford it."
Some, however, are on the outside looking in.
Shane Welsh, 22, worked a flagman's job Tuesday for a Cascade Natural Gas crew installing lines into a new subdivision on Bear Creek Road east of 27th Street. Flagging brings in an average of $15 per hour during the busy summer months, but Welsh said he and his girlfriend can barely afford their $620-a-month rent, much less save for the ever-rising price of local property.
So after 10 years in town, his dreams of owning property here may never happen.
Still, "Could be worse," he said. "Could be raining."
David Fisher can be reached at 541-617-7862 or at dfisher@bendbulletin.com.
Published daily in Bend, Oregon, by Western Communications, Inc. Copyright 2006.
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