In California it's what's known as a repo tour. RE/MAX broker Bill Dwyer is calling this one the Tour of Hot Deals. The idea is to take a group of prospective home buyers and real estate investors on a bus tour of houses with loans that are in foreclosure or otherwise priced below the market value.
As real estate prices slide downward, the concept is hot in California. Dwyer believes this is the first time such a tour has been tried in Jackson County.
"We've never done one of these," he tells about 20 potential buyers Saturday morning at his office near the Medford airport. "But you've probably seen them on TV. There's no pressure. We want everybody to kick back and have a good time."
"I saw it on TV in California, and then here it was," says real estate investor Greg Allee of Medford. "I had to come and see."
"We've been amazed at the number of repossessions in the paper every day," says Sue Allee, Greg's wife, of legal notices that run in the Mail Tribune's classified section.
As more people fall behind on loans, and more houses come on the market, there is downward pressure on prices, experts say. Southern Oregon Multiple Listing Service numbers released Wednesday showed a 9.1 percent drop — from $253,000 to $230,000 — in the median sales price of existing homes in Jackson County, excluding rural properties, for the quarter ending Jan. 31. In the previous five years, the median price for existing homes in the county had increased almost 50 percent.
After coffee and doughnuts, everybody piles into a big bus with Dwyer and RE/MAX's Steve Tollefson, and the bus heads for the first property on the tour, a 30-year-old, 1,600-square-foot home in Central Point listed for $229,000.
"That's the listing price," Tollefson says. "What the bank will take is another story."
There's a nice yard, a white picket fence. There is a musty smell inside, and walls are painted purple and green. A couple of prospective buyers say it looks like a lot of work.
The second house is a 1942 cottage that's had a total makeover, including floors and appliances. The sparkling, 1,784-square-foot house is listed for $268,000. A tray of freshly baked cookies welcomes lookers to an updated kitchen.
"This is nice," Greg Allee says.
Tom Lee of Medford agrees. Lee says he buys a house about every two years.
"The last time I looked, houses like this were $20,000 more," he says.
He's tired of being a landlord, he adds. "Tired of the hassles."
Some of the people say real estate, despite ups and down, is still a good investment over the long haul. The Allees, who moved to the valley from Thousand Oaks, Calif., in 1999, bought their first rental house in Medford years ago for $59,000.
"We bough a rental last year in Medford that didn't quite pencil out," Greg says. "But in a couple years ... "
The Allees bought their first house in Southern California for $23,000.
"And Greg's dad thought we were crazy to pay that much," Sue Allee says.
"It always goes up," Greg says.
California's real estate market was red hot until the recent downturn. But foreclosures there were up more than 200 percent in 2007. Real estate experts here say the Southern Oregon market feeds off California.
The 15 houses on the tour range from $195,900 to $499,000 and from about $140 to just over $200 per square foot. Some, but not all, have been foreclosed and are owned by banks.
A 2,332-square-foot home in Central Point that appears to be an update on the Craftsman concept is priced at $358,000. It boasts cherry floors, a huge family room upstairs and a waterfall in back.
The next house, at 1,714 square feet and $275,000, sits on a new lot in a newer subdivision. It has an open but odd floor plan, in which visitors enter a small, windowless living room, which gives way to the kitchen and dining area on one side and the family room on the other.
"I don't know what you'd do with this room," Sue Allee says.
"Eat in the dark," another woman says.
So it goes. Another dozen homes are on the tour, from the glitzy to the funky. And there's lunch, courtesy of Dwyer and Tollefson. The tour figures to be wrapped up by midafternoon.
"We just want everybody to see what's out there," Tollefson says.
The Allees think the concept gives investors a chance to get a sense of the market.
"I think it's a good idea," Greg says.
Dwyer says another agent in his office plans a similar trip to the Eagle Point Golf Course community later in the month, probably on the 16th.
Reach reporter Bill Varble at 776-4478 or email@example.com.