Home prices are rising at a faster pace in Redmond than in Bend as retirees, investors and working-age people turn to a more affordable market.
The median sale price of single-family homes in the Redmond area reached $306,000 in July, according to The Beacon Report, compiled by Beacon Appraisal Group of Redmond. That’s 16.8 percent above the July 2016 median of $262,000. This was the third July in a row that Redmond posted a year-over-year increase of more than 10 percent.
“We were looking for a bigger house on a bigger lot with a smaller mortgage, and we were able to accomplish that in Redmond,” said Chelsea Olsen, who bought a house in July with her husband, Evan Olsen.
The Olsens, who moved to Central Oregon last year after selling their house in Albany, paid $269,000 for their 1,800 square-foot house, built in 1966, in southwest Redmond. They were the first to put in an offer the day the house was listed, and it was accepted that day.
Bend has also seen big year-over-year jumps in the median sale price of single-family homes, but the pace is not as fast or as consistent as in Redmond.
The Bend area median of $413,000 in July was 13.5 percent higher than a year ago, according to The Beacon Report.
In July 2016, the median price was just less than 10 percent over the prior year, and in July 2015, the median price increase was 4 percent.
Meanwhile, the pace of appreciation in Redmond has increased each year since at least 2014, the Beacon Report shows.
“Redmond’s fascinating to me because it’s got a steady growth to it,” said Donnie Montagner, owner of Beacon Appraisal Group. The Beacon Report for the Redmond area includes sales of single-family homes on 1 acre or less in Redmond, Eagle Crest and Terrebonne.
With 80 to 100 homes sold each month from May through December, Redmond is still a much smaller market than Bend, where 243 single-family homes were sold in July.
The pace of appreciation in Redmond suggests that retirees and remote workers — people who aren’t relying on local wages — are playing a bigger role in the housing market, said Damon Runberg, Central Oregon regional economist for the Oregon Employment Department.
In Redmond, housing costs are more tightly aligned with local wages than in Bend, Sisters and Sunriver, he said.
Land developer and homebuilder Bruce Dunlap estimates that at least half of what his company builds in Redmond goes to empty nesters. They want single-level homes on a larger lot than they can find in Bend, he said, and they like that Redmond is less congested. Many of them are paying cash, he said.
“It’s amazing how few people that are buying our houses are getting mortgages,” he said.
Redmond is also attracting real estate investors like Bob DuBois, who in July bought a small house near NW Cedar Avenue after he couldn’t find the fixer-upper he was hoping for in Bend. DuBois thinks Redmond will become more attractive to renters as the community grows.
But he said he was surprised by how much rent his property manager suggested. DuBois, who didn’t disclose the rent, said he’s not sure how long Redmond can command such high prices.
“Rents have gone up,” he said. “Wages haven’t.”
Redmond is some buyers’ first choice of places to live.
“We’ve just always loved this little town,” said Connie Johnson, who moved to Redmond from Mesa, Arizona, last fall. Johnson, 56, said Redmond was home to her great-grandparents, grandparents, and now her parents, who live not far from her home on NW Elm Avenue near the Dry Canyon Trail.
Even last fall, finding a house in Redmond was a nail-biting experience.
“I knew I wanted an older home close to downtown,” she said. “It was rising like crazy.”
Johnson is watching her neighbors list their houses for much more than the $265,000 she paid. And her daughter and son-in-law, who followed the Johnsons from Arizona, are considering moving back because they can’t find an affordable house in Redmond, she said.
Chelsea Olsen said she also preferred Redmond’s small-town feel over Bend, even though she and her husband both work in Bend.
“A commute that’s 30 minutes or less is not a big deal,” she said.
— Reporter: 541-617-7860, email@example.com