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MailTribune.com
  • 'New money coming into the market'

    Return of contingency sales helps spark a modest county housing comeback
  • Contingency offers — in which an offer to buy a house is contingent on the buyer selling their existing house — were once a bread-and-butter aspect of Rogue Valley real estate.
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  • Contingency offers — in which an offer to buy a house is contingent on the buyer selling their existing house — were once a bread-and-butter aspect of Rogue Valley real estate.
    But that kind of deal essentially went away when the bubble burst six years ago, because buyers couldn't count on selling their own houses.
    "When contingency offers came," said Ron Galbreath, an agent with Coldwell Banker, "we would just deny it, we couldn't trust someone would be able to sell their home in another area."
    The once-common scenario, however, is making a comeback, helping to bolster Southern Oregon's modest real-estate comeback.
    "There is new money coming into the market," said Galbreath, who recently had a contingency deal go through.
    "The folks who made the contingency offer sold their home in Castro Valley (in the Bay Area) in 45 days," Galbreath said.
    The latest Southern Oregon Multiple Listing Service figures show the median price for existing houses rose as increasing activity continued to reduce the inventory of existing single-family residences.
    The county-wide median price for existing houses sold July 1 through Sept. 30 climbed 9.1 percent to $169,900 from $155,750 a year earlier, while the number of units sold jumped 24.2 percent to 564, compared to 454 for the summer months a year ago. Turnaround time on the those transactions dropped to 57 days on the market from 99 days.
    The inventory of available houses continued to decline, with 1,139 units available as of Sunday versus 1,517 on the market a year ago.
    Another positive indication for the local market was that 58.5 percent — nearly three out of five deals — were traditional sales at a median price of $202,600. Bank-owned foreclosures accounted for 23.6 percent of transactions at a median price of $137,500, while short sales were 17.2 percent of sales at a median price of $150,000.
    Local real-estate observer Roy Wright of Roy Wright Appraisal Service in Medford said three consecutive positive quarters is a good sign.
    "Four years ago, we were in the third year of decreased home sales and second year of decreasing prices," Wright said. "Now, with three quarters of increasing sales and prices, we're going the right direction."
    SOMLS figures show the September median rose 9.2 percent to $174,000 from $159,275 in 2011.
    New construction — both on and off the SOMLS tracking system — has improved as well, with a 15.5 percent boost in median price to $219,450 from $190,000.
    "The sawdust is flying again," Wright said, citing construction projects in Phoenix, Eagle Point and east Medford. "Not a lot of it, but some, and that's encouraging."
    The Castro Valley couple, who declined to be interviewed on the record, sold their 1,400-square-foot house, built in 1954, for $450,000 and had a 1,258-square-foot house built on Gravenstein Way, off Orchard Home Road, for $162,900.
    There's been a turnaround in California that has been about six months ahead of us," Galbreath said. "We've seen their market turning around, and we seem to be riding their coattails."
    Colin Mullane, an agent with Full Circle Real Estate, has also seen a steady increase of outside buyers.
    "With that out-of-state money returning," Mullane said, "it helps stimulate the economy, something we've been missing the last several years."
    Whether the present rise in median prices continues past the fall is anyone's guess, but Mullane expects buyers to be looking as long as interest rates remain low.
    "I haven't been this busy in 10 years," he said. "I don't think that will change in January as long as rates stay low."
    Reach reporter Greg Stiles at 541-776-4463 or email business@mailtribune.com.
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