The workers are expected to get their jobs back in four to six weeks, once the company refines production and improves its manufacturing process, said Randy Bolinger, vice president of marketing and business development.
The furloughed employees — primarily workers who built the planes — will continue to receive medical benefits and training in new manufacturing techniques, and will be eligible for return-to-work cash incentives.
I, for one, will be very curious if the company keeps these promises. Continuing medical benefits suggests they will, or at least were making financial expenditures that make it seem reasonable that they "want" to hire these people back. I hope they do.But I also have the feeling that what is now a "temporary" lay off may start to feel like getting fired to these people. First there may be an extension of the lay offs. Then benefits are cut or eliminated. Finally the company will declare the "laid off" as deserters, because they aren't available. They had the temerity to go get new jobs!
Well, I hope this does NOT happen. But let us all revisit the promises of Columbia Air in two weeks...
Ah yes, and what would Bend be without a daily dose of Kool-Aid, and in the form of a report on Cascade Bancorp, no less! The Bulletin actually put out an article on the fall of Community bank share prices:
Community bank share prices drop -Analysts attribute dip to high investor expectations
Excerpts:
Bend's Cascade Bancorp, holding company of Bank of the Cascades, which saw prices rise to almost $32 per share in late December. Cascade shares closed at $23.14 Friday, down 27.7 percent from their December peak.
"Cascade still has one of the best management teams (among the banks) I cover," he said. "I think sometimes, expectations can get out of whack. (Cascade) wasn't as profitable this quarter, but it doesn't mean it can't happen again."
"So, what's the matter with that?", you ask. I simply ask that you read between the lines. CACB has fallen off a cliff, so what's the problem? Oh right, right, right, right, right, right.... it's INVESTOR EXPECTATIONS. It's evil New Yorkers! Their expectations are UNREASONABLE! Cascade was the perfect little jewel until those maniacal scumbags in New York beat it for NO REASON. Oh right...
"For a bank that usually knocks the ball out of the park, all of a sudden, the balls are falling short," Feldman said. "And the possibility that the company is actually mortal is scary (to investors)."
So they actually do acknowledge that CACB growth has slowed, and lo and behold:
Share prices for some community banks in Central Oregon have slipped by double-digit percentage points this year, as the slower housing and construction markets catch up to financial institutions regionwide, analysts say.
So there we have it. A roundabout way of saying that housing is ACTUALLY CONNECTED to the performance of local banks... funny how that works. And the slowing has beat up CACB, BUT to thoroughly MIX OUR SIGNALS, let us say NOT that housing is the primary cause, BUT HIDEOUS EAST COAST types are the real problem.
I tell you folks, the Bulletin must believe that the Bend populous' appetite for Kool-Aid is never ending. I sincerely wonder if the Bulletin will FLAT OUT acknowledge:
A) That there was a BUBBLE (no, not a "hot market" or some such) in Bend real estate.
B) The BUBBLE has burst, NEVER TO RETURN. Nope, not a "temporary cool down" based on "expert" testimony (2,000 Realtors).
C) That the RE BUBBLE (and by extension, the Bend RE industry juggernaut) bursting is NEGATIVELY impacting the entire regional economy.
I doubt it. Just like CACB falling is NOT tied to Bend housing, it's East Coast investors.
30 comments:
How funny. I read that bank piece without a second thought. The "unrealistic investor expectations" explanation seemed perfectly reasonable.
Until you think about it: Blaming investors for a falling stock price makes you wonder who they "blamed" when it was going up?
I have always read "unrealistic investor expectations" as "we thought this stock (or business) rocked, but it turns out it sucks."
And just to be clear: This is not really a piece beating up on CACB (I really don't even think a busted RE market will hurt CACB as much as the massive influx of competition).
It's The Bend Bulletin. It's putting out lame pieces blaming "others" for the problems of Central Oregon, but greedily claiming all sorts of credit for the good things. OK, the "Good Things" ARE our fault, BUT SO ARE THE BAD. We're not "Gods Chosen People", we're just People.
I wonder who'll they'll blame when the Columbia Air lay offs become permanent? My guess: Malaysians.
Another unpleasant anniversary: Seaswirl is putting out its last boat. All these things will eventually trickle into the unemployment rate here, the ultimate arbiter of "How It's Going" in Bend.
And if it can't get worse, I read in the Bend blogosphere that Bend IS NOT making the "Top 10", "Top 50", or "Top Whatever" lists of Great Places To Live, Retire, or Meet Chicks. I'm telling you: Bend was very much a Fad Town. It's fun & great & all, but it has been flogged relentlessly in the media, and that accounts for a lot of the inbound population, the fleecing of whom accounts for a large share of Cent OR income. According to David Foster:
You can blame the rapid increase in prices on the fact someone told the world that Bend is a great place to live, which has led to record growth in population.
What happens when someone STOPS telling the World that Bend is a great place to live?
I found BOTC CEO Patty Moss's reaction to her company's having lost about 30% in market value in 4 months to be hilarious:
Patricia Moss, president and CEO of Cascade Bancorp, said she isn't concerned, noting the company has seen its share price rise from $5 in early 2001.
"It's one quarter," Moss said. "We look at the (stock's) performance over long periods of time."
Investors and analysts love hearing that one. "The stock goes up one quarter, down another - we don't really pay attention." If she was operating in any market but Bend, she'd never let slip a quote like that, because she'd know that when the stock's price inevitably continues to fall in Q2, in July she'd have that quote thrown back in her face. There's no real journalism in Bend, though, luckily for her, so she can say whatever fluff she wants and The Bulletin will just print it.
Also, don't know that it's such a great idea to note that the stock was at $5 before the RE boom. Might make some analysts think that's where it belongs after the RE boom.
Let's see if Moss and her allies have enough voting shares to stay at the helm while they ride Bank of the Cascades back down into the muck from whence it rose.
Just keep drinking the kool aid and repeating these quotes from last week's CACB Bulletin story. Everythings going to be OK....
Patty: "It is a great advantage that Cascade's markets are expected to have sustained population in-migration underpinning the economic vitality of the regions into the next decade."
Translated - we will grow our way out of this and any ther problem.
Frank Weiss "We expect that the nationwide correction in real estate will ultimately benefit our markets by virtue of a more sustainable rate of economic growth in the months and years ahead."
Translation - A softening real estate market is a good thing. No real reasoning behind that, just trust me it is because I can't think of anything else to say."
Guys,
Of course I have been the major doubter of CACB all these months.
But in the longer run I am actually quite positive on Central Oregon generally.
Why?
Global warming. Seriously.
Add 5 degrees to Arizona and Nevada, and take away the water. Its all uninhabitable. Raise the sea levels a bit in Florida, Texas, California. Goodbye beaches and property values.
Where will all of these people go?
Central Oregon is one of the few places with a lot of open land and a lot of water. Everytime farmland gets converted to residential property it actually frees up water.
And the US population is steadily growing.
I'm very bullish long term. The question is whether one can actually get in at attractive valuations. That point is not here yet. But I'm holding onto my Central Oregon assets.
Of course I could be wrong
-CACB Shorter (formerly)
...of a sudden, the balls are falling short,"
Or just falling off, or being kicked off or maybe even cut off. Depending on which coast your on.
Watch what Moss does, not what she says.
If Patty Moss supposedly takes a long-term view of her company's stock price without much heed to how CACB is performing in any one quarter, how did she manage to have perfect timing in selling hundreds of thousands of dollars in stock in the quarter where the stock price peaked?
I'm amazed, but CACB continues to just get pounded. Just cut right through $22.50, and falling. I thought there'd be a big dead-cat bounce by now...
I still think it's headed for $18. Wonder how the Bulletin will spin that? Probably something akin to "Affordable stock!".
But at $16-18 it'll start to look good.
Well, it's Tuesday, so it must be... that's right! David "Dia" Lereahs' monthly downward revision in housing sales, AND glowing forecast for The Future.
Existing-home sales fell in all four regions in March. Sales fell 10.9% in the Midwest, 9.1% in the West, 8.2% in the South and 6.2% in the Northeast.
"This number reflects subprime lending" as well as the cold weather in February, said David Lereah, chief economist for the real estate group.
Because existing-home sales are counted when they close, cold weather in February kept buyers away and reduced the number of closings in March. The weather had been unseasonably warm earlier in the winter, boosting sales.
Lereah said he expects sluggish sales in the second quarter, but he thought sales would pick up from March's low. "We're still looking for existing-home sales to gradually improve during the last half of 2007," he said.
Wow, does this guy ever tire of being DEAD WRONG?
On a lighter note, it appears the Hobbits are now having their say ...
I suspect this has something to do with the view from the Kanes of St. Francis where hobbits have a pint in the eve, and they're also not happy about the "The Shire"
This article is largely concerned with Central Oregonians, or Hobbits as we call them in Cascadia.
In the old times there were three kinds of Sapiens that roamed the old earth, Hobbits in Cascadia, Goblins in Mordor { south and east of cascadia }, and Man { sometimes called people } in the old Arab world to the east, and the asean world to the far-west, both across great oceans. Long ago man ruled the old earth, but he nearly became extinct and thus forgotten until the great oil wars. During the great oil wars the arab people of the east were completely wiped out by great diseases created by the Nazgul of Mordor. The people of the far-west { aseans } survived as they did not physically partake of oil wars, only financed them, thus in time they held most of man's paper money which of course was ultimately without value.
Concerning Cascadian-Hobbits, they're gentle creatures more concerned with the earth, .e.g. hiking, biking, generally being outdoors, and near things green that grow from the earth. They love children, micro-brew, and southern-cascadia grown pipe-weed. The simple things in life, they're despised by the Goblins in California/Mordor. The cascadian hobbits love to be outdoors. The goblins love prisons, their homes are like prisons, they build schools like prison's. The prison and killing industry was the basis for their economy.
The goblins south of cascadia they call themselves Californians { Mordorians } are only concerned with themselves, money, and their car- keys. They prefer metal or plastic, and live only for accumulation. They hate the natural earth and crave to cover it all with concrete and/or asphalt. The Mordorian's have completely covered their own native lands with asphalt and such, and they seem only happy when doing so in new lands.
Middle Earth, or should I say cascadia is now past its third age. The dark lord Sauron { Cauron in cascadia } of Mordor long ago forged the one car-key to rule them all, today californians all consider their car keys their 'precious', as the evil of long ago once worshipped the ring of power.
Mordor ( california ) has once again awoken, the californians have erected an Issengard right in Bend Oregon calling it "Franklin Crossings". The hobbits of bend didn't seem to notice change, until the sun was blocked by this new Issengard. This alerted the hobbits of bend, the Bend council long taken over by Goblins, Orcs, and Gollum like creatures spoke of more Issengards in Bend, and of great Mordorian subdivisions in the north called "Juniper Ridge". It is said that the Bilbo of Hobbiton was the first to notice the Issengard {Franklin-Crossing} monument from the Kanes of St. Francis while having a pint, at first it was thought that he had one too many, but in time others saw, and found that he was correct. The cascadian shire of Bend had forever changed.
The Nazgul or in Cascadia we call them the "Mercedes Driving Goblins" are trying to re-unite all the car-keys, they believe in the One Car-Key to rule them all of the old legend. The Mercedes has always been the greatest phallic icon to wealthy Goblins since the darkest times of the third age. When a hobbit see's a mercedes with mordorian plates they are taught as children to run seek shelter. The old legend speaks of Sauron not a goblin or man, but a spirit that oversaw the oil burning machines and all the business associated with its financial system.
To the old people there was the Farthings, there was west, middle, and east, the Hobbit people of Eugene were most west, and the desert dwelling of Hobbits in Bend were the most east. In the second generation after the great war goblins from the south or mordor, e.g. California came to plunder the land. Over the years the word got back to mordor that hobbits in Bend were weak creatures, that could easily be confined to small lots in mordor type subdivisions.
By the third generation, before our times the goblins had taken over Bend { desert cascadia }, and many hobbits you would not recognized they became like the gollum of the old legend. Legend says that Hobbits that adopt Californian and/or Mordorian habits become vile and ugly creatures.
Today the sun shines over hobbit Shire-Bend and many cascadian hobbits see a chance to take the one car-key that rules them all back to california-mordor. In this age it has been become more difficult for those that built Issengard { franklin-crossings }, as the the banks that funded these ventures were they themselves houses of sand. Once all around Issengard was destroyed, the young Goblins of California no longer came to cascadia for there was no hobbit blood to draw, as they're elder's had sucked the land dry. For generations the goblins descended on cascadia like locust in search of gold, oil, and trees, eventually there was nothing left so they moved on.
To the far east across the great ocean's in the east the gobllin's of mordor had turned their attention to pillaging the great arab lands of the old earth the land of man, where the ancient ones are of said to have invented algebra & Law. For long the the goblins of Mordor thought their car-keys were the source of power but they learned in the times that oil, was the source of power, so they destroyed the old world of the Far-East. They killed and killed for generations, in time, the children returning killed thier own, for this is all they knew of life. The returning goblins of the great oil wars killed their own family's upon returning to Mordor. In the end of their times they resorted to eating one another where the strong orc's ate the goblins, and nazgul ate the orc's.
The goblins of Mordor had become sicker and sicker by this third generation having wasted the land of the so called country of california, that which we hobbits call mordor. The Goblins of Mordor in the late third age discovered Oil. The Goblins consumed the oil, and bathed in the oil, and in time became Orc's. Millions of Orc's were bred in Mordor, and they were used for the great oil wars that went on for generations, until at last the oil was gone, and there was nothing left to steal in the arab-lands of the far east.
In thus doing as they struggle to build more Issengard { Franklin Crossing's ...} like monuments in cascadia they could no longer borrow from the people of the far-west, the so called Fourth-Age people {aseans}. During this time the hobbits of Cascadia saw an opportunity to once and for all rid themselves of those that worshipped the car-keys { californians, aka mordorites }.
The hobbits of cascadia banned the goblin-mobile, that foul spelling monstrosity that burns fossil fuels. Soon the Goblins had no means of transportation, as they had long ago lost the means to walk on their own. Generations of long wars of killing for the sake of killing for oil, and land left the Goblins without children, and they became gradually extinct.
The hobbits of Cascadia tried to teach their young of the old ways of gentle earth loving folk, when the goblins lost their health they created television, that they broadcasted into hobbit homes with the hope of making hobbits love the things that goblins love, but the wise old hobbits simply unplugged the tv's. With the loss of the propaganda machine, the Goblin ideology's became legend.
In the fourth age hobbits reverted to simple of old, as all the treasure that the goblins of california could take had been taken, but the hobbits still had a little water, some earth, and their love for things green.
The goblins of california, unable to borrow wealth from the new age people of the far west { asean new world } wallowed in filth, and became extinct. They could not rape and rob as they had done in the far east { arab old world }, as they're great killing machines had long been destroyed by attrition. The people of the Far-West { aseans } would no longer finance the the great oil wars. In the final act of desperation the NazGul created a great disease which the people of Mordor called "aids", which was a combination of orc-blood from orcs that had leukemia and wild pigs. This concoction was found to be transmitted sexually and released in the Dark Conentinent of Africa far south of the Arab lands of the Great ancient east. The Nazgul called land where the orc-blood and pigs were harvested "Litton-Bionetics". In time all human life in Africa was wiped out, it is thought that the goblins had intended to settle in Africa having destroyed Mordor and making it un-inhabitable. The so called 'aids' was unleashed in the arab world, but failed, as they not being promiscious people, thus the nazgul resorted to created millions of orc's who slaughtered the arabs man, woman, and child. During the end times the goblins attempted to unleash their aids weapon upon the far-west aseans, but they being a clever people quickly developed an antidote. By these times the goblins of Mordor had become nearly extinct.
Eventually the returning children of Mordor all children who were killing machines, turned on their own familys, bringing an end to Mordor.
Most recently the people of Mordor have built 'The Shire" near Bend, a monstrosity that is supposed to be like Bree, but is just another Mordor SubDivision. Only a few homes in the new shire have sold, and those only to surviving Goblins and a few Gollum like hobbits. Most of these new homes will never be built as the Goblin financial system had collapsed making it impossible to get easy money to build Mordorian structures near Bend.
Hobbits prefer to live on a few acres, where they can have animals, and the children can play. The Goblin's preferred little 50by50 concrete lots where the home's actually touched each other, this was thought a way to as the Goblin Leaders { NazGul } could have the goblins keep an eye on each other.
All of the above is distant legend, its important that this legend be passed down. Even though the Mordorians have wiped themselves out, their spirit lives, the times of greed, war, rape, and pillage could return if the young hobbits are not educated. Those that not know there past are destined to repeat.
In today's Bulletin, in a story headlined "Confidence reigns for bank" reporting from BOTC's annual shareholders' meeting, Patty Moss is directly quoted as making a granddaddy forward-looking statement:
"We may not have double-digit earnings growth every year," Moss said. "But we believe that, over the long term, we can expect double-digit earnings growth (on an average per-year basis)."
Wow! Pushing the envelope of Section 27A of the Securities Act of 1933!
By the way, the subheadline of the Bulletin story is "Cascade Bancorp shareholders, officials aren't worried about recent drop in share prices." All of them? BOTC executives and The Bulletin editors have one thing in common - they love making broad, unqualified generalizations!
>>"Cascade Bancorp shareholders, officials aren't worried about recent drop in share prices."
My God, this is like Clockwork Orange! I mean are they going to pry our eyes open and make us worship Patricia Moss?
Gotta love that The Bulletin feels NO COMPUNCTION WHATSOEVER about STATING FLATLY what the Kool-Aid addled masses in Bend think about the falling share price of CACB.
Anyone wanna bet they probably don't say this about any other stock headquartered OUTSIDE of Cent OR?
"Shareholders THRILLED with CACB shares plummeting, but angry about all other stocks falling..."
"We may not have double-digit earnings growth every year," Moss said. "But we believe that, over the long term, we can expect double-digit earnings growth (on an average per-year basis)."
Warren Buffett has often railed against this sort of nonsense. His argument is basically, you can achieve "double digit earnings growth" from a savings account that pays 2%/year... just keep adding money to the account until you get it.
Moss smells like she's on the acquisition trail (much akin to borrowing money at 6% & putting it into your 2% savings account, so it will "hit the earnings mark"), which is almost always a bad idea if it is merely fueled by nothing more than the idea of "achieving double digit earnings growth".
I actually kind of like the smell of Moss, for example, the Moss growing on the lee side of a river boulder.
did anyone mention that BOTC declared a 9c/share dividend too
they run that company like theyre a buncha methheads
The opening line of today's BOTC story is:
Cascade Bancorp stockholders said Monday they're not worried that share prices have dropped roughly 28 percent in four months, noting that their stock has doubled in value during the last four years.
I want to point out something that is obvious to Paul and other statistics-wise folks: that drops are bigger on the way down than on the way up.
When a stock has "doubled in value" it has increased in value by 100%. When that same stock (or anything else) has dropped in value by 28%, it's eaten up 39% of the 100% increase.
I haven't followed CACB over the last 4 years - is the 100% up to the peak or up to now?
At any rate, CACB dropped 2.3% JUST TODAY. The stock is getting clobbered. Clobbered.
I would say that Paul's take, that at $16-$18 CACB will be a bargain, is optimistic. One thing people aren't taking into account (and, not to brag, a thing I talked about on my blog) is that right now, the market is skeptical about community banks in general, let alone those whose market is a bubble area, let alone those who have what was even noted this time last year by analysts as an inordinate proportion of construction loans in their portfolios.
Bank of the Cascades is, in my opinion, a study in layered risk.
Another thing that bears repeating: check out this Bulletin story from April 2006 and the ridiculous assessments Patricia Moss and others make about the C.O. economy. Will The Bulletin follow up on this like a big-market paper would? I feel safe saying "no way."
One institution bought 3 million shares of CACB in December 2006 at roughly $30 per share. Their paper loss is at least $24million in four months. Perhaps the Bulletin should ask them how they feel.
-CACB Shorter (formerly)
You can add John Mitchell, US Bank's regional economist to the list of people with irrational exhuberance about this region's economy. A few months later, once it was obvious things were amiss here, he was quoted in The Bulletin as saying this region would not be immune and could be in for a tough time this year.
Patty, John Mitchell, David Lereah, and anything from The Bulletin have all the credence of a televangelist asking for money on the Trinity Broadcasting Network, and it seems there are enough people in this town that buy into it all.
There's an air of depressing foreboding in Bend right now.
You go to a bar and you're talking to a Realtor. She's a bit down in the dumps. You say, yeah, man that must be a rough adjustment after the boom times, and they're like, "Yeah." Then someone not in the RE biz says, "But it's a great time to buy, right?" Someone else laughs, it all gets awkward, and the Realtor just says, "Well..."
Some people are willing to talk about the white elephant in the room. Some aren't. Some don't even see it.
I think the Bulletin could do this town a huge psychological service if they finally just said, "Uncle. It sucks, OK? It's going to suck for a while. Bend is a great town. The High Desert is beautiful. The air is clean and the skies and mountains are thrilling, but it sucks now. Some of you are going to default. You sellers at $750,000? You're going to get a haircut that feels like a scalping. Some of you are going to have to move away. Sorry. We don't have a real economy yet. We're going to have to work on that. Hard work. We're going to have to grow a brain and do things better."
Instead we get Bend's body carried around and propped up like we're watching "Weekend at Bernie's."
--TT
Over on BendBB, "St Paddy" posted
this with respect to CACB:
Small builders, on the other hand are going to be the desperate ones sooner than most. One reason being that their construction loans usually have a one year call on them(or less) and when they don't sell it is very difficult for them to get permanent financing because in times such as now the banks look at them as builder bail out loans, where the builder finances his profit and then defaults on the loan. I've heard from a reliable source that BOTC has hundreds of construction loans coming due on specs and they can't get these builders permanent financing so they are extending the calls on these loans and pressuring the builders to lower their prices to get them sold.
I'm always looking for where the first domino to fall will come from in sending prices lower, and this seems a reasonable source. These banks HATE being in the RE business, I've seen estimates it costs $40-50K to unload 1 foreclosed property. It makes more sense for them to tell builders to cut price to whatever the hell will sell a property, and give them (the Bank) the money, otherwise they will simply have to do it themselves.
And I guess I should say, I think CACB becomes "interesting" in the mid-teens... it becomes very, very interesting as a takeover target @ $12. But banks can get KILLED in bad markets, and go much farther South than it seems possible. I remember Bank of Boston going to $3 (late 90's), down from $40-50, in a very short time. It ultimately bounced WAY back, and got bought hundreds of percent off the bottom, but well below it's all-time highs.
Oops, that Bank of Boston plummet was "early" 90's... Trump was going bust at the time...
And I also should clarify that prices are already a "little" lower, but I'm really looking for the catalyst that pounds prices way, way down 30+%.
An interesting stat from Clives Inventory Counter: The number of $1 million+ properties for sale as a % of the total, down from 9.1% to 8.4%. This is a decent reduction, down from 200 to about 180 properties in this price range. I think MANY of these were the "Bucket/Box" sellers looking for the biggest moron in the 18 state area. I think many will give up.
And this also reminds of a post by someone essentially stating that "prices aren't really going down, it's just the very high priced stuff is not selling anymore." I would counter by saying that if prices aren't going down under that definition, they never really went up. Ludicrious & unrealistic expectations were there, but there were precious few sales. The maximum unit sales in Bend was Q3 2005 @ 830 sold with medians (YTD) @ $269,500. Q1 2007 units sold is 396, or less than half, with medians @ $347,750.
Any nut can put their 1992 Toyota Corolla up for sale at $50K, but that says nothing about what Toyota Corollas are worth, only the delusional nature of that seller. That fringe element of completely idiotic buyers is being put out of business now. There's nothing but hot air clear down to $250K. At that point the air becomes slightly thicker, but I still say the bottom is at real medians below $200K and a decade + away.
I think TimT should start lowballing small builders... CACB will call the shots soon, and they look to be getting desperate. And tell 'em to cram their upgrades with walnuts. That's just the Randy Sebastian school of Go Kart Marketing talking, and like any "upgrade" scheme, you lose 20% driving 'er off the lot. Tell 'em you'll just take the money and they can keep their granite countertops. Those are just white elephant upgrades that you'll lose money on.
>>An interesting stat from Clives Inventory Counter: The number of $1 million+ properties for sale as a % of the total, down from 9.1% to 8.4%.
I've noticed and thought about this as well.
One possibility is that it's simply a factor of the huge number of houses that have undergone price reductions. We have had a lot of houses price reduced from 1.1 million to 900k.
--TT
Hey Paul, please come back to the economy blog, it sucks without your posts. I know bendbb is kind of an ass but your comments are sorely missed. I think you and bend economy man are the ones with the most realistic view of what is headed our way here in real estate shangri la.
EDCO chief shares rosy outlook for area growth
By Anna Sowa / The Bulletin
Published: April 27. 2007 5:00AM PST
Roger Lee is willing to bet that Central Oregon's real estate market isn't going to tank. In fact, he told an audience at Thursday's Women's Council of Realtors luncheon that he bet someone $10 that the market isn't on a savage spiral downward, as some might believe.
"You'll get it," one of the audience members assured him. Heads nodded.
As executive director of Economic Development for Central Oregon, it's Lee's job to analyze the local economy and predict its future for the purposes of creating sustainable economic growth for the region. At Thursday's meeting, he said the housing market is settling to a healthy level from its peak, keeping the area's economy vibrant in the short run, though not record-breaking.
The local real estate market peaked about a year ago.
"Obviously, there's been a little bit of fallout, especially in residential realty," Lee said. He later presented slides that showed Des-chutes County foreclosures declining since 2002 - from 450 at their peak five years ago to 229 in 2006.
Additionally, home ownership is higher in Central Oregon than the state. In Deschutes County, the most recent homeownership rate was 68.3 percent in 2005, compared with 63.8 percent in the state and 66.9 percent in the nation.
Deschutes County has the third-highest rate of homeownership in the state, behind Clackamas' 70.8 percent rate and Umatilla's 69.9 percent rate.
For those who haven't bought a house or can't afford to, affordable rental housing remains a problem, Lee said.
"There's more of an affordability issue on the rental side," Lee said. "We see hardly any large-scale housing complexes (being developed), which would provide affordable housing."
Lee expects Central Oregon to continue to lead the state's growth, with more than 9,000 tri-county babies added in the last 15 years. But only 28 percent of the region's growth comes from natural increases (births over deaths), he said. Seventy-two percent of the region's growth comes from in-migration.
As more people move here, more industries will come in to take advantage of that growth, or sprout locally, Lee said. By 2012, he forecasts Central Oregon's total non-farm payroll to grow by 24.4 percent, or to 89,440 jobs. Of those jobs, Lee hopes to attract manufacturing and technology companies to help diversify the region and increase wages.
He said EDCO recruits employers that offer annual salaries of no less than $30,000 to $35,000. Larger employers are preferred, but he said the region typically attracts 10- to 15-person businesses. And until more land is freed up by expanding the Bend's urban growth boundary, expensive light-industrial land will deter prospective employers, Lee said of an issue EDCO is trying to solve.
Lee also predicted:
* The population of Central Oregon counties by 2012 will be led by Deschutes, 204,233; followed by Crook, 34,397; and Jefferson, 24,420.
* By third quarter 2007, the regional population will be more than 210,000, with Bend growing to 80,000.
* Juniper Ridge, the development north of Bend, will begin construction around the fourth quarter.
* UGB expansion will be approved in first quarter 2008.
* Jefferson County's first resort will be approved (barring legislative blockage), with a third resort beginning in Crook County in third quarter 2008.
* Redmond Airport terminal expansion will be completed by fourth quarter 2008, allowing more direct flights to Portland and possibly new flights to Phoenix and Denver. The smallest aircraft will be 50 seats because smaller planes eventually will be phased out.
* Redmond's U.S. Highway 97 bypass will be complete in first quarter 2009.
* Bend's Old Mill District will be fully built out, bringing new residents and retailers, in first quarter 2010.
* Bend's average home price will exceed $500,000 in second quarter 2010, Prineville's will be $280,000 and Madras' will be $250,000.
* Central Oregon will add 45,000 people by third quarter 2010.
Finally, Central Oregon will secede from the state in the first quarter of 2011, Lee read from his PowerPoint presentation.
The audience chuckled.
"Just a little fun there," he said.
Hey Paul, please come back to the economy blog, it sucks without your posts. I know bendbb is kind of an ass but your comments are sorely missed. I think you and bend economy man are the ones with the most realistic view of what is headed our way here in real estate shangri la.
Thanks for the comment. That little spat between me & BendBB really never should have happened. I made a completely off-the-cuff remark about last July being the top (and it was really June... or Sept based on what data you look at...) and we were "down" in prices from that time, and BendBB just went ballistic, and I'm not sure why. I even apologized (yes... unbelievable), and that was like throwing meat to the wolves, he just got more adamant that I was posting lies for the specific purpose of misleading people.
I'm fine with all that... I'm pretty thick-skinned. But then it became obvious that it was a personal attack, and that I was going to be held to totally different standards than anyone else. He stated ALL my posts were "irrelevant"... I mean, you tell me what the hell that is about.
I may post there on occasion, but BendBB is the moderator, he has veto power over posts, and he has clearly shown he has a personal vendetta against me. If I do post, it'll be anon.
Believe me, I wish that strange interchange hadn't happened, and really don't understand why it did.
Moving on...
At Thursday's meeting, he said the housing market is settling to a healthy level from its peak,
For those who haven't bought a house or can't afford to, affordable rental housing remains a problem, Lee said.
Whoa. Is this dude smokin' the cracker? Does he even CONCEIVE the idea that renting in Bend is a FRACTION of the cost to buy? What a quack. EDCO must supply free Kool-Aid at the water cooler.
>>Roger Lee is willing to bet that Central Oregon's real estate market isn't going to tank. In fact, he told an audience at Thursday's Women's Council of Realtors luncheon that he bet someone $10 that the market isn't on a savage spiral downward, as some might believe.
"You'll get it," one of the audience members assured him. Heads nodded.
Wow, way to put your money where your mouth is, Roger Lee!
You can't make this shit up.
Women's Council of Realtors...
Is it possible BEM, that he's playing to the audience? No.... no way. This is high drama. After all, he laid down 10 WHOLE DOLLARS that we won't go into a "SAVAGE SPIRAL DOWNWARD".
I would say that a "SAVAGE SPIRAL DOWNWARD" has NEVER happened in US real estate market history. At least not in my definition. Note that Mr Lee's definition been left UNDEFINED so this bet is moot, at best. Both will certainly keep their precious $10.
Even the most brutal local decline in modern history, the 40% beating in Lafayette, LA from 1986-91, loped along at a leisurely -10%/year. If there is a possible definition of SAVAGE SPIRAL DOWNWARD, it is this, and 10% down just doesn't sound all that brutal.
Monty Burns: By cutting off cable TV, and the beer supply, I can ensure an honest winters work out of those lowlifes.
Smithers: But sir, did you ever stop to think, that maybe it was doing *this* that caused the previous caretakers to go insane and murder their families?
Burns: Hmmm, perhaps. Tell ya what... we come back and everyone's slaughtered, I owe you a Coke.
"I think the Bulletin could do this town a huge psychological service if they finally just said, 'Uncle. It sucks, OK? It's going to suck for a while.'"
Yes, it would be great but it'll never happen. I've lived here more than 20 years. The Bullshittin faithfully subscribes to the "booster" school of "journalism" -- always has, always will. Its editors believe their job is to act as cheerleaders for the local economy and never publish anything "negative." It's kind of the good-old-boy Kiwanis/Rotarian ethic.
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