Stoked by in-migration and cash investors, Rogue Valley home sales picked up in May, and the market appears poised to emerge from a year-long malaise.

Stoked by in-migration and cash investors, Rogue Valley home sales picked up in May, and the market appears poised to emerge from a year-long malaise.

The Southern Oregon Multiple Listing Service reported the countywide median sales price of $200,000 between March 1 and May 31 was surpassed by the May figure of $212,700, pointing to a stronger summer selling season. The three-month figure rose 8.1 percent from $185,000 a year earlier.

"You used to see investors finance half of a $200,000 house; now they are going all in," said Colin Mullane of Full Circle Real Estate in Ashland and spokesman for the Rogue Valley Association of Realtors. "When an investor's money is sitting in the bank right now, it's not even making enough to cover inflation."

Traditionally, Mullane said, investors would make a significant down payment and let renters cover their borrowing costs.

"Generally, when you do that, your revenues are smaller because you're having to pay off the loan," Mullane said. "But once you get the loan paid off, you're getting maybe two times the income. Investors who pay cash may have to wait to get the return, but they want complete autonomy."

Nationwide, 42.7 percent of existing home sales were cash deals during the first three months of the year. In Jackson County, the figure was 30 percent, said Roy Wright, a longtime appraiser who has tracked the local market for more than 35 years. Last month, the figure dipped to 24 percent, as more first-time buyers and people looking for more or less space entered the market. As a result, 46 percent of the mortgage loans were classified as conventional, 11 percent were FHA and 7 percent went through Veterans Affairs.

"If you can pay cash, you're going to be generating 10 to 12 percent free cash flow," Wright said.

Soaring rents coupled with large down payments work to an investor's advantage, he said, citing his own experience with buying a condominium several years ago for $71,000 that now rents for $950.

"I net $700 a month on it, so I'm getting almost 12 percent pre-tax return," he said.

Homes also sold faster this spring, with an average of 46 days on the market, compared with 61 last year.

A relatively small inventory and slower in-migration led to declining year-over-year figures through March. In April, single-family sales exceeded the 2013 figure, 196 to 191. Last month's 241 sales were 6.6 percent above the corresponding 2013 figure of 226. For the three months ending May 31, 523 units exchanged hands, compared with 527 for the same period in 2013.

"The inventory is up 16 percent over last year," Mullane said. "But it just doesn't feel like that at all. Buyers are really watching the websites to see what's coming on line."

The median price for a rural home in Jackson County fell 7.7 percent to $284,000. A total of 114 rural homes sold during the rolling quarter, with an average of 94 days on market.

In Josephine County, SOMLS reported the median price of existing homes in incorporated areas leaped 12.8 percent to $186,200 during the past three months compared with $165,000 last year.

The median price for rural homes rose 7.8 percent to $237,250 from $220,000 a year ago.

Reach reporter Greg Stiles at 541-776-4463 or Follow him on Twitter @GregMTBusiness, friend him on Facebook and read his blog at Edge.