September home sales show lack of affordability

With a median price of $825,000 and an average price of $889,010, September single family home transactions in Sisters Country show a continuing trend of lack of affordable housing stock. The inventory of available homes remains low as sellers are stuck in their homes sitting on mortgage rates of three to four percent.

Were they to sell and finance a new home at current 30-year lending rates of 6.365 percent such sellers would be often doubling their monthly payment. Likewise, there is a scarcity of buyers unwilling or unable to qualify for a purchase at the current rates.

In the quarter just ended, only 78 homes exchanged. While an improvement from the third quarter of 2023 when 67 homes sold, it’s below recorded sales in 2019 and 2020.

As a further sign of pessimism for young families and first-time buyers in Sisters, seven of the 23 September sales exceeded $1 million — 30 percent of the total transactions.

The total dollars transacted in the July-September period was $65.7 million, down from $71.2 million in the same period last year.

Taking the median September price of $825,000, a borrower would have monthly payments of $4,113 but when you add in insurance and property tax, that number jumps to $5,396. And that’s after a 20 percent downpayment of $165,000, an amount that fewer than 10 percent of young borrowers have.

More staggering is the $215,000 income the borrower(s) would need to qualify. That’s virtually three times the median income in Sisters. In other words, nearly the impossible for all but those who are asset-rich.

Indeed, just over half of all Sisters real estate sales the last four years were to cash buyers.

Realtors say that there is little hope in the short term to reverse this trend. Only two of the 23 September sales were under $500,000. Just four under $600,000.

It’s not much better for renters. According to Oregon Office of Economic Development, renters are the hardest hit. More than half of renters in the state don’t have enough money after paying rent to afford other basics, including food, childcare, internet access, and transportation.

Because the state’s housing inventory is so limited — Oregon simply doesn’t have enough units for the number of people who need them — there are limited rental vacancies, so landlords can raise rents with few repercussions. As a result, Oregon is among states with the lowest supply of rentals that are affordable to people at or below poverty levels. (A unit is considered affordable if it costs someone 30 percent or less of their income.)