The year opened with good news that should significantly impact the future value of your investment in Sunriver. The recent purchase of the Sunriver Village by a local group with significant resources, and the strong push by the SROA Board to solve the problem of our aging pools and infrastructure, are giant steps in the right direction. The Village has been purchased by a local group that I believe will finally succeed in delivering on the promise of a new Sunriver Village. These moves are positive for property values in Sunriver and will maintain our status as one of the Northwest's premier destinations. Please support these upgrades, as you will benefit from increased property values and a vibrant community.
At the beginning of 2008, it was clear that the housing market nationally was headed for a significant retreat in both volume and pricing. Driving this retreat was a decrease in property values and foreclosures after an overheated market in 2005-2007. Sunriver began 2008 with a typically slow first quarter (see chart), followed by a nice increase in home sales the second quarter. The big surprise in the second quarters, however, was the large drop in both the price per square foot and the percentage of sales price. This was the first clear indicator that prices were going down and a buyers' market had arrived. The third quarter, which is usually one of our best, saw a significant decline in price per square foot and the number of homes sold. The fourth quarter continued to show a decline in the price per square foot, and sales prices were dropped to 90 percent of the listing price.
I have estimated the numbers for the first quarter of 2009 based on the best data available at mid-March. The first quarter shows an increase in volume over the first quarter in 2008, but continues the steep decline in price per square foot to $231. Currently, there are 148 homes listed for sale with an average of $268 per square foot. A year ago, homes for sale averaged $300 per square foot, so it is clear that sellers are beginning to understand that prices have to come down in order to attract buyers. Furthermore, homes with a low price per square foot are the ones that are selling and driving the averages.
I have included average selling price in the data, but please understand that the sample size is too small to accurately gauge how far prices have dropped. The drop in price per square foot is a much more meaningful piece of information. Also, remember that the age, location, size and condition of your home will determine if you are at the high or low end of the price-per-square-foot range. On the positive side, with significantly lower interest rates and a large selection of homes in all price ranges, Sunriver is much more affordable than it has been in recent years. If you want to buy in Sunriver and expect to own your home for 3-5 years, this is the time to invest. Pricing may not be at the bottom, but it is close. You won't know where the bottom is until prices start to go up and inventory goes down, limiting your selection.
If you are trying to sell your home or thinking about selling, put yourself in the buyers' shoes. Ask yourself if you are competitively priced base on the market. Buyers have the advantage of time and many homes to choose from, and they are looking for compelling value before they will part with their money during these challenging times. I expect buyer traffic to increase as spring approaches, but I also expect a significant number of new listing to come on the market, and these listing will be aggressively priced if sellers are serious.
Please contact me if you have any questions regarding this article. Resort properties are my specialty, and I'm happy to share my market insights.
John Watkins, Broker
Bennington Properties
Sunriver, Oregon
Jdw48@mac.com
The February 2009 US Travel Association survey of 2,270 U.S. adults is now complete, and the results reveal both "good" and "challenging" news for travel service suppliers.
