Summer Smoke Hits Higher End Homes Hard

In an article two months ago, we talked about how the real estate market was being negatively affected by the smoke and repeated closures of interstate 5. Now that summer has ended, we can look back and survey the actual effect the fires had on our summer home sales.

Since 2013, the real estate market in Jackson County has seen year over year growth in both the price of homes and the number of homes sold. 2018 will most likely be no different, except that the pace of growth will be slowed down due to poor summer sales. If you look at this summer’s sales, July 1st through September 30th, the number of homes sold decreased by almost 15% compared to last summer. The decrease came in the higher end real estate markets, mainly Jacksonville, Ashland and East Medford. These are areas of higher end homes that cater heavily to out of state buyers. Jacksonville was the worst hit with 46% less homes sold this summer than last summer. Not everyone saw home sales decline as we had very healthy increases in homes sales in West Medford, South West Medford and areas of lower priced homes catering more to the local buyers.

Home prices this summer increased an average of 4.5% over last summer. This number represents one of the lowest increases we have seen in a while and, again, areas of more expensive homes were harder hit, some seeing a price decline. The median price of homes in Jacksonville fell by 4.1%, Ashland fell by .6%, and East Medford increased by only 3.4%. In areas of lower priced homes, we saw some drastic price increases this summer with North West Medford increasing by 25.5%, West Medford increased by 16.2% and White City increased by 9.2%. The overall median price of a home in Jackson County has increased over 43% the last 5 years and is currently at an all-time high of $290,000, with it likely to hit $300,000 by the end of the year.

To sum it up in one sentence, this summer brought increased home sales and higher prices for lower priced homes and lower prices and lower sales of higher priced homes. The local home buyer continued to shop for homes but, by all accounts, the out of state buyers chose to stay home.

The question now is how quickly the higher end housing market will recover from a smoke filled summer. We hope there isn’t much long term effect to our market but we do know some of our clients have decided to retire in other areas with fewer forest fires. We also are seeing some first time home buyers that are getting squeezed out of the housing market by rising interest rates.

On a positive note, the economy is doing well, our area is growing in population, we have full employment, and 10,000 baby boomers are hitting the retirement age of 65 every day. Many of these retirees are deciding to retire to areas outside of where they are currently living that are less crowded, less expensive, and offer more activities. Southern Oregon is perfectly positioned to take advantage of the exploding number of retirees, as long as we can curb the fires.

 

Smoke, Pot and Tariffs Slow Southern Oregon Real Estate Sales

2018 started out with a bang and we saw the median price of a home in Jackson county increase to $285,000 – up from $194,500 in 2013. This means the average home has seen its value increase $18,000 a year. The number of homes sold has also increased this year by about 8%, which makes the outlook even better. We would have predicted an all-time record year for Southern Oregon Real Estate but then came the Smoke, Tariffs and decreasing demand from the pot growers.

 

While sales of homes under $400,000 haven’t seemed to be affected by the smoke, there has been a decrease in sales and the number of showings of more expensive homes. Often it is the visitors from out of state who are looking for homes in the price range of $400,000 and up. There are so many tourist attractions that need the tourists to survive such as the Oregon Shakespeare Festival, Britt Festival, Hellgate Excursions and the wineries, and they have all been hurt by more than a month of smoke. Tourists and prospective retirees will be back, and it’s unlikely the smoke will have a lasting effect, but in the meantime, we will see a dip in high-end home sales.

 

We have also seen a decline in value and demand for rural properties, especially irrigated, rural properties. We believe most of this decline is due to the end of the exuberance of marijuana legalization which caused a rush on irrigated land and drove up rural land prices. Today there is so much marijuana grown in Southern Oregon that the prices have dropped significantly. In June, the OLLC temporarily ended licensing for new marijuana grows, which was the end of irrigated rural property being purchased for the purpose of growing pot. We still have, and will always have, buyers pursuing irrigated land to grow hay, vegetables, grapes, fruit and more, but not as many as we have seen in the last two years.

 

Newly imposed tariffs on lumber, steel, drywall, nails and other key construction supplies have pushed up the average price of a new home. One study printed in the Wall Street journal states the average price of a new single-family home in California has gone up as much as $20,000 due to tariffs. Another AP article states tariffs have increased the lumber cost of an average single family home between $8,000 and $10,000. Already in July we saw record inflation at 2.9%. If this inflation continues, the Federal Reserve will have no other option than to increase interest rates, as a counter measure to limit the growth of inflation. As a reaction to the tariffs, and increased cost of goods, some major US manufactures have already announced plans to increase their prices by as much as 20%. So, it looks like we may be facing a “Wall of Inflation” caused mainly by tariffs which will lead to higher home prices in both the cost of the home and the interest rate to buy that home.

 

We have lost some valuable selling time to smoke, and we lost some demand from the marijuana growers, but as the smoke clears, the out of state buyers will be back. If they don’t hurry back, they may be surprised by how much their dream home has gone up in price and the increase in the interest rate to buy that home.

 

 

 

 

 

Jacksonville is Oregon’s most beautiful small town, magazine claims; we offer photographic evidence

Caught up in the hectic big-city rat race, many Americans dream of small-town living. The calm pace, friendly neighbors, quaint stores. A place where you can take a deep breath — and not end up in a coughing fit.House Beautiful magazine understands the allure, and so this summer it identified what it considers the “most beautiful small town in every state.”

And the winner in Oregon? Jacksonville. The magazine heralds the “historic town that’s in the heart of the state’s wine country.” It also gives a shout-out to “the sounds of the Britt Music & Performing Arts Festival [that] fill the town” every year.

House Beautiful points out that Oregon’s small towns are “jewels,” which is undeniable. But is J’ville the most beautiful of them all? We’ll let you decide for yourself. We’ve searched our archives for photos past and present that show Jacksonville in all its charming uniqueness. Take a look below: 

Click Here for the link

https://www.oregonlive.com/expo/life-and-culture/erry-2018/08/4ce27a71797462/jacksonville-is-oregons-most-b.html

 

The Quest for the Perfect Retiree Home 

By Graham Farran

Southern Oregon has attracted retirees for years with its four seasons, culture, wine industry and outdoor activities, all combined with great heath care and affordable housing.  For the last sixteen years, we have been helping hundreds of people find their perfect retirement home and along the way we have learned a lot about the perfect retirement home and how to retire the right way! In our office, we have a standing joke that the number one most requested home in Southern Oregon for a retiree is a one story home, new construction, on one acre and in town.  To find a home like this can be hard, so they often end up compromising and end up with a two story house with the master on the bottom, completely updated, but not necessarily new, and outside of the city limits. Most of our retired clients are in great physical health but have taken care of their elderly parents and have seen first-hand what it looks like to be in your 90’s; so, they are planning for the future and want to “age in place” and not have to move. What has surprised us is how many retirees have never lived on rural property before but want to retire on a rural property. Many have spent their lives in subdivisions, and part of the attraction of Oregon is its rural feel and small population.  They have been living all their life in homes on small city lots with sidewalks, street lights, neighbors and crowds so it’s natural that they have dreamed of living in a rural setting. We have learned from our clients and have seen some important differences on how to retire. There is no right or wrong way, there are just different ways. Here are some philosophies on how best to retire.

GET AWAY FROM IT ALL
Many retirees come here with dreams of living on rural property. Many prefer to be away from a city, on a river, in a forest, with a view, but away from herds of people. We all want what we don’t have, so it’s natural to leave a state like California with 40 million people and seek a rural life. We have helped so many retirees find a beautiful piece of property – some so private you can’t see a neighbor, some with shops large enough to accommodate all their retirement hobbies, some on a river or creek, some with irrigation to start that vineyard they have always dreamed about and some with views to die for. These rural homes make for a great retirement, fulfilling many life dreams and are perfect in early retirement.  However, in many cases, when they reach their 80’s or 90’s, their rural properties become too much to handle and they call us to find them a smaller house near town and medical services.  So, the only downside is that often a rural property is not the last retirement home.

WALK TO TOWN
There is another philosophy involving retirees who want to move to a small one story, newer home, within walking distance of stores and restaurants. Jacksonville is a popular place for this. Everywhere in Jacksonville is close to town and you can walk everywhere. Retirees see themselves as aging in place and living in their last home. With our housing prices well below our neighboring states to the north and south, we are seeing couples who are able to sell their homes out of state, buy a great home here, plus have monies left over to invest in the stock market or buy a few rental homes.

HAVE TWO HOMES
We have also seen many retirees buy two homes and split their time at each. This can take many forms – one home here and one near their grandkids, one home here and one winter home in Arizona or Hawaii, one home here and one on the coast. Or my favorite, one home here and one home in the mountains, perhaps near a nice, high mountain lake. So many of our clients have turned into our friends, and what we have learned from them is to plan well for your retirement, no matter what age you are, make your retirement time one of the greatest times of your life, fulfill your dreams and enjoy those golden years.

 

We Owe It All To Ashland

Last weekend we had a great time in Ashland. It was a date night and we had dinner at MAS, a new restaurant serving a pre-fixed, eleven course dinner with a pairing of Sake or Wine. After that, we stayed the night at the historic, high-rise, Ashland Springs Hotel. When we got the reservation for the hotel, we got the last room available – which I thought was unusual. It’s only May and not yet peak time for the Oregon Shakespeare Festival (OSF) and the 11 plays that tourist flock to; but apparently OSF keeps Ashland busy 10 months a year with 780 performances. As we were leaving Ashland and headed home, I thought to myself how Southern Oregon owes much of its success to Ashland and to OSF for bringing in 410,000 play goers, mainly tourists, every year. To accommodate all these play goers, Ashland has, over the years, expanded the theaters, built scores of charming B&B’s, motels and hotels and added many incredible diverse and outstanding restaurants.

Personally, I was first drawn to this area in 1996 when I saw ads on TV for OSF. In the ads they showed the Rogue Valley, the plays, the mountains, the lakes and river rafting. This was well before there was much of a wine industry in Southern Oregon. Those ads got me interested in visiting Ashland, but I never heard of Medford, Jacksonville or any other towns in Southern Oregon until years later. As I started to vacation up here, I started to explore the entire area, rafting and Kayaking the Klamath, Rogue and even the Applegate river. I saw a huge valley on the map between the Rogue Valley and Grants Pass, so I decided to drive through it on Hwy 238, and on the way, I discovered Jacksonville and the Applegate Valley. That was a great day, and I fell more in love with Southern Oregon.

Finally, moving here in 2002 and settling in Jacksonville, I have come to appreciate that there is beauty everywhere I look in Southern Oregon and I’m thankful that Ashland drew me to this area. Every day I notice how Southern Oregon is growing. We are adding to the draw of Southern Oregon, expanding what we offer to tourists, escapees and retirees. If you haven’t seen that, think about the Wine Industry, almost non-existent when I first visited in 1996, it now has over 150 Wineries. Every quarter I look forward to reading the Wine Scene with 60 pages of articles packed with new wineries, new tasting facilities, and scores of metals being won. Our local wine industry has created a draw for tourists and locals alike. The wineries are a great way to see the local beauty of Southern Oregon while sipping wine, dining, and enjoying live music. In my opinion, our local wine industry competes well with the Sonoma and Napa wine areas, and offers tourists and locals a more kicked back, casual experience.

When I first moved here the shopping was limited, but ever sense, I have seen ever expanding shopping, restaurant and hotel offerings giving locals and tourist more options. We have seen local hotel groups along with Marriott, Hilton and other national chains expand their branded hotels each year. Restaurants are popping up all over with the latest additions, Baja Fresh, 5 Guys, Cracker Barrel, Heroes American Café, Firehouse Sub and MAS. Both local and national retail chains keep opening up and offering a never ending array of shopping choices, all without sales tax.

With the growing success of OSF, our wine industry, and the increased shopping has come the addition of Uber and Lyft to get us around easier, expansion of local roads and the badly needed Hwy 62 bypass. Our little airport has seen a record amount of passengers flying in and out and has added American Airlines, more flights and larger jets. Southern Oregon has truly become a destination for entertainment, outdoor activities and fun!

The real estate industry has been one of the big winners as our valley now has more to offer. We have a never ending amount of retirees and families escaping large metropolitan areas and moving here to start a new life. We are seeing a huge demand on real estate with very little supply of homes for sale. Last year the median home price rose by over 10%. This year we’re seeing the same increase in home prices along with a 20% increase in the number of homes sold! With sales of homes increasing at a double digit pace and few homes on the market, we’ll see lots of new homes being built and prices of existing homes continuing to rise.

Does Southern Oregon owe all its success to OSF and Ashland? I think so! Ashland has always been the first point of contact to so many tourists and the magnet that pulled me and many others to visit. Once here, you fall in love with Southern Oregon and dream of coming back. So, thank you Ashland and OSF, if it wasn’t for you, I wouldn’t be here.

Getting Top Dollar For Your Home – Stage, Replace or Remodel

Getting Top Dollar For Your Home – Stage, Replace or Remodel

Often we get asked how to increase the value of a home before selling it. Sometimes the answer is simple, and sometimes the answer if more complicated – especially, if the seller is interested in investing a little time or money. There are some improvements that increase the value of a home and some that just increase the sellability. Most sellers are prepared to get their home staged to sell, but in some cases they can dramatically increase the value of their home by replacing or remodeling. Here is a look at how to get the top dollar for your home by staging, replacing or remodeling.

Stage
  The key to create sellability is to create a clean, decluttered, and depersonalized home. Curb appeal, or more importantly, web appeal, while viewing online is critical. When a buyer approaches the home or sees the first photo online they should be visually attracted to the home. For example, groomed front gardens, fresh tanbark, fresh flowers, power washed siding, and a clean or newly painted front door. Once inside, the same theory applies – clean and decluttered surfaces free of personal photos or knick-knacks. We tell clients to start packing and start decluttering to make their home look larger and more inviting to buyers. When a buyer feels comfortable enough to sit down on your living room couch, they have begun the process of envisioning the home as theirs.
 
Replace
  Going beyond staging can yield a higher value and simpler, lower-cost projects tend to return greater value. Every year, The National Association of Realtors commissions a study done by Remodeling magazine on Remodeling and Replacement Cost vs Value, and each year they come up with very similar results. Here is the 2017 list of the return on investment of the top 5 and the bottom 3 replacement projects rated by cost recovered.
 
Project                                                    Cost Recovered
Garage Door Replacement                                                                    121.1%
Entry Door Replacement                                                                        101.5%
Minor Kitchen Remodel                                                                          100.5%
Window Replacement                                                                               93.1%
Adding manufactured Stone Veneer                                                       89.9%
Bathroom Addition                                                                                    70.2%
Master Suite addition                                                                                67.9%
Deck addition                                                                                             65.5%
 
  Notice a pattern? With the exception of the minor kitchen remodel, they’re all replacement projects that enhance the curb appeal. In general, replacement costs less and provides a bigger payback than remodels or additions. First impressions are important. The replacements that offer the greatest payback to sellers are the ones that are most obvious to buyers when they first view the house in person or online.

Remodel                                 
  The remodeling cost vs value report makes it clear that large scale jobs aren’t likely to return sellers their full cost; but, there are remodels worth doing in anticipation of an upcoming sale. Some may return 100% of their cost or more. Others may not have as much of a payback, but they can improve the market position of the property in relation to the competition. In addition, several projects can provide owners with a few years of enjoyment while still offering decent payback down the road. Kitchens still offer the most remodeling bang for your buck.
  Another way of drastically increasing the value of your home is by adding square feet; but, unless you can do it cheaply, you’re not likely to recover your full cost. New construction cost per square foot is high, and in many cases, higher than the resell price per square foot. We have seen some remarkable value added to homes by inexpensively adding square feet – usually by finishing off a daylight basement. We saw one seller double their square feet by simply adding sheet rock, some interior walls, windows, flooring and lighting to finish their basement.  In another case we advised a buyer to pay an extra $30,000 to add a usable daylight basement with a bathroom on a custom built home. Although it is not completed, the owner can complete it at any time, adding another 1200 square feet to his home with very minimal effort or cost.
If you do decide to remodel your home before selling, here are a few words of advice – make sure you complete all projects before putting your house on the market, there is nothing that turns buyers off faster than a house filled with the owners’ unfinished remodeling projects.
  So whether you decide to Stage, Replace or Remodel, just remember to consult your Realtor on values in your area and projects that will yield more than your investment. With the increasing demand for homes, and limited supply, it has led to a sellers’ market, so if you have been thinking of selling, now is as good a time as ever.