Sunday, April 8, 2007

Sisters, Duncan, Inventory, and David

A short post on a few topics of interest:

First, I read a very interesting article in the Nugget News, the Sisters newspaper. It's interesting in that it is not the usual egregious fluff piece, basically saying that Mrs X did task Y and hence should receive 6 Nobel Peace Prizes. It's a fairly introspective piece, "Sisters at an economic crossroads". Here is an excerpt:

A few are thinking toward the future and trying to attract the kind of business that will provide a sustainable economy.

"I would like to attract businesses to the area that will be low impact, businesses like software engineers or other high tech businesses that will bring young families and build a financial base for the city that is not driven only by the tourist season," said Shane Lundgren, area resident and property developer.

The Sisters Area Chamber of Commerce is on the same page, if not in the same paragraph.

"We would like to get a person to help the chamber that understands economic development: someone who could find a way to attract business and investment in Sisters that would lead toward a sustainable economy; someone that could help find ways to attract the kind of businesses we would like to have," said Mills.

Aspen Lakes Golf Course has come to grips with the idea of building a sustainable economy.

"We have a good tourist base, but we want to expand our base in Sisters," said Grant Cyrus, general manager. "We would like our new clubhouse to be a magnet for Sisters."

Software engineers? High-tech businesses? Building a sustainable economy?

Sounds like someone may have been listening to old Paul-doh! I have whaled fairly consistently on Sisters for being an insular, in-bred, oldboy, Boss Hogdom town. And I think they are starting to realize what happens when you do this: You end up with a withered, non-diversified and lethargic economic base. Sisters has 3 industries: Real estate, tee-shirts, and real estate. When the cycle is on the upswing, all is well. But we're entering the downswing, and I think this town is beginning to do a little soul-searching.

Personally, I think it's too late. It's too late for most of Central Oregon. We had our shot, and we blew it. Boss Hog said Throw Every Cent BACK Into RE, and we complied. After all, the news in the local papers made it sound like a fantasic idea! But, at least Sisters may be facing the music, and will start taking the right steps.

Duncan put up a post a few days ago that I just got to. First sentence:

"I'm beginning to wonder if BendBubble2 blog hasn't been right in ---what I have felt up to now was his over the top criticisms of the Bend City Council."

Over the top? Me? Perish the thought! Possibly he was referring to my conservatively titled March 1 post:


Excerpt from Duncan:

"if you have suspicions, it certainly could appear that some of the councilors are there for personal gain."

Duncan then lists a litany of self-dealing, shady practices that have transpired in this town, some of which don't reflect too highly on the ethical standards of our beloved Bend City Councilors. I recommend this post for an extremely well-written and informative read.

Clive Holloways Inventory Counter just busted through the 2,000 mark this week. (I'm not really sure what the cause of that weird plunge is, although murmurs at BendBB suggest it is a data error.) Anyway, homes for sale in the Bend area are at 2,055. Bend media will say "Nothing to see here, move along", but this is an historically unprecedented number that DOES NOT bode well for the much anticipated Spring selling season.

Speaking of which, I am much looking forward to the release of David Fosters March RE market summary. It will almost certainly be the subject of my next post. I'm not really predicting much change in the price area, but I do think absolute dollar and unit volumes will be down YoY. March is the first month to give a little glimpse of how Spring will go. If it's in the doldrums, and a lot of the pie-in-the-sky $650K and up crowd doesn't get flooded with offers 40% higher than their ask at their Open House, we could see the next 6 months get UGLY.

And that's what I think will happen. There are way too many people here in a Kool-Aid coma who have been led to believe that because Bend is populated by Gods Chosen People, that their house is worth 25% more than comps. And in heaven, you don't mark down your house when it doesn't sell, you keep it up and just wait for the Biggest Idiot In the 35 State Area to arrive with their Bucket-O-Money, ready to buy YOUR HOUSE. And they will. After all, there are only 7,450,123,892 more exactly like it within a stones throw, and they could be snapped up just like that.

I think buyers are going to see prices (and the monster glut of inventory) this Spring in Bend, and pull a George Bush Sr:





Anonymous said...

Bite Your Tongue! Spring Sales Will Be Fantastic!

I think BEM would agree with me that, "Bends torrid growth is expected to minimize the negative impact."

pagemaker said...

I do think absolute dollar and unit volumes will be down YoY.

That's almost a no-brainer. How far down is the question.

I think it's funny all these nuts who don't realize there is damn near 8 years of high-end inventory out there! EIGHT YEARS!

Anonymous said...

Overpricing property has rewarded Bend sellers and Realtors so consistently over the past few years, that they're like Pavlov's dogs. It might be years before they can be "reconditioned" to be realistic.

In the meantime, nothing will sell.

IHateToBurstYourBubble said...

Dang, I forgot to get to this quote by BEM on Duncan's blog:

This town is used to growing its way out of its problems. Read any article in The Bulletin or watch any KTVZ news story and they'll always cap off any negative news by saying "Bend's booming population growth is expected to minimize the impact."

It's that last sentence. Why, in Gods name, is that in ANY news piece? OK, I can see if they are quoting someone that they're interviewing, but they're not. This is a bit of editorializing right in the middle of just about every business news piece in The Bulletin. This sort of statement is ubiquitous throughout Bulletin & KTVZ reporting, and essentially constitutes 104% of all CBN content.

Why in the World does the Bulletin think we need to hear:

"Don't Worry... everything will be just fine. Busted RE market? No worries, we'll grow our way out. Head hurts? We'll grow. Just got fired? Just put your head on my lap, and let me rub your head. You just don't give that another thought, cuz growth is going to pay your mortgage for you. Now you just relax, and have another sip of this Kool-Aid I've made..."

I'm telling you folks, living in Bend is more like living in a cult than a real town. Start reading and watching Bend media with the slightest hint of critical thinking and you'll be blown away. Except for CBN... no critical thinking is required, as they make no bones about being a bought-and-paid-for rag of the RE trade.

Anonymous said...

"...Bucket-O-Money, ready to buy YOUR HOUSE."

Don't forget about their box of stupid too!

Over at Ben's HBB, there is a poster that has pretty good tag line which makes me think of our RE market...Got popcorn?

Anonymous said...

I just renewed my lease for another 9 months hoping that the fall/winter will be a better buying opportunity.

I am stocking up on popcorn in the short term.

IHateToBurstYourBubble said...

Don't forget about their box of stupid too!

Oh I didn't! The box of stupid has gotten so big, that it has to come up on a separate truck...

Anonymous said...

My relatives in Seattle say that the Seattle media was similar 10-12 years ago. It was the city that couldn't stop talking about itself.

Now that grunge is gone (along with Boeing's headquarters), Seattle is a little less self-referential and self-congratulatory.

As Bend's bubble bursts, Bend will grow up psychologically. It's just a baby now.

Anonymous said...

Seattle's housing prices are up more than 100 percent since the period you're referencing here.

IHateToBurstYourBubble said...

Seattle's housing prices are up more than 100 percent since the period you're referencing here.

100% in 12 yrs is 5.9% year.

Anonymous said...

"Seattle's housing prices are up more than 100 percent since the period you're referencing here. (1994-1996)"
And Portland's are up more than 100%, and the nation's too. Your point?

BendBust said...

There is no point, there is never a point.

What do you call a bunch of middle age guys that live with their 90 year old mothers?

Bend Netizens, what do you call them when you give them access to Internet ? The Bend Blogger Brigade, meets mondays at Deschutes Brewpub, largest group of 'metrosexuals' in Bend.

They wonder why the county pets are turning seeking shelter???

Joey in Sisters said...

Yeah, I'm totally stumped at the people moving into Sisters then buying absolutely OVERPRICED homes and lots. Granted properties are not selling at the pace did a year ago. But the fact that anything sells right now just baffles me. It must be the leftover retiree crowd that sold in Southern Cali 6 - 8 months ago? Who else could it be? LOCAL WAGES DO NOT SUPPORT A $460K 1,300 SQUARE FOOT "BUNGALOW". GET REAL - GET BENT!!