Home prices in the Bend real estate market have joined numerous other major cities in surpassing the housing boom peak of 2006-2007. Other major U.S. cities that have set new highs according to CNBC News today include Portland, Seattle, San Francisco, Denver, Dallas, Austin, Boston, Pittsburg, and Charlotte. Bend’s average home price May through July, 2016 of $432,000 exceeds the previous high of $429,000 reached in the same months in the peak in 2007*. And with June 2016 marking 50 consecutive months of national price appreciation, the U.S. overall is within just 1.1% of a new national record high.
But the big question everyone is asking, is the Bend real estate market in another housing bubble like the one back in 2007? The answer is yes… and no. While we are experiencing once again the rapid growth in home prices overall and a bit of a frenzy among home buyers, the impetus for these rapid gains is quite different. The previous boom was largely being driven by faulty loan products such as No Doc Loans that people simply couldn’t afford. The current market is being driven primarily by a severe lack of supply and continued record low mortgage rates. However, if mortgage rates do start to inch up, this could put some pressure on the Bend and national housing markets and we could see home prices start to soften a bit.
*Data from Central Oregon Multiple Listing Service
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