Solid Recovery in Klamath Housing Market

This article was in Thursday’s (August 31st, 2017) Herald and News

Written By: Gerry O’Brien, H&N Editor

The Klamath Basin housing market can only be described as “phenomenal,” exceeding predictions from this time last year, according to one local realtor.

Randy Shaw, representing the Klamath County Association of Realtors, said that, compared to the first seven months of 2016, this year the total units sold were up 13 percent.

“That’s a pretty big number,” said Shaw, who is also head of Coldwell Banker Holman Premier Realty.

“We have some 50 closings scheduled for September, alone.”

Last year at this time, Shaw was hoping for and predicted an 8 percent growth rate. At the time he thought if that held steady, the housing sector has stabilized.

“Thirteen percent growth is pretty phenomenal,” he said.

The numbers represent just residential real estate, including single family homes, rural homes, condominiums and townhouses. It does not include commercial or agricultural land.

In 2016, from Jan. 1 to July 31, there were 1,058 units sold. This year, the number jumped to 1,205 units for the same period.

Total dollar volume was $160,345,000 of residential real estate. This year, it’s at $204,252,000 for the same period of time, a 22 percent increase.

Where’s the difference?

“So that’s an indication that we’re finally breaking through the ceiling of selling $250,000 homes or higher-end homes,” Shaw said. For the past several years, the number of homes that were selling quickly were in the $140,000 to $180,000 range. The more expensive home sales were languishing. Now, they are picking up, Shaw said. The homes selling for $250,000 to $350,000 are becoming the norm. The average sale price is also up 11 percent from last year to this year.

In the $250,000 and up range, 139 were sold last year. This year, agents sold 184 units — a 25 percent increase.

“That’s pretty significant number” Shaw said. A larger part of the marketplace is being generated from the $250,000 and up range.”

“I believe what is going on is that we’re seeing larger numbers of retirees coming out of

San Francisco on down into Southern California, especially Sacramento. And we’re seeing more cash deals than we’ve seen in a long time,” he said.

Bidding wars

Agents are seeing multiple offers on homes, up to four bidders at one time. Those with cash are cutting out the traditional loan-backed buyers.

“And I’d be remiss if I didn’t mention that this is affecting our veterans seeking to buy homes,” Shaw said. Veterans using the traditional VA loans have much tighter restrictions on home-buying opportunities. A seller will take cash first, rather than wait for a VA loan to be processed.

“I’ve talked with congressional leaders that the loan process is big a problem for our veterans,” Shaw said.

Delays in appraisals are not affecting the market as they were last year, Shaw noted. Most appraisals are getting done in the 60- to 90-day period.

“So the appraisal backlog has softened a bit.”

Real estate agents number 164 in the county. At our low point there were 125, at our high point 254. When the market started moving in 2003, 2004, the market took off and people jumped into real estate. And it’s starting to feel like that again.

Dire need for spec homes

What’s missing from the market are spec homes, those new homes that builders put up in the hopes buyers will come.

There’s a shortage of spec homes, because developers have put their money in the larger markets such as Portland and Eugene. And the construction workforce is just not back to what it was pre-recession.

“Local contractors have their dance card filled, so it may be a year or two before we see more spec homes on the market,” Shaw said.

To read this article and others on the Herald and News website, please refer to the following link:

Solid Recovering in Klamath Housing Market (H&N) 

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