As I reported last month, Keizer Oregon had a huge plunge in home prices rather than doing the steady decline that Salem did in the past few months. Salem Oregon real estate corrected 3% here, 5% there, where Keizer kept going up, then nose dived.
I ran the same “what if” scenario for Keizer that I did for Salem, just for fun. If Keizer had stayed on its early decade average of 4.4% increase in median home prices, the median home price for this quarter would have been $6,000 more than it is now.
With a current median home price of $183,150, Keizer prices have come back down to earth. There has been a rash of well-priced homes on the market, and they tend to sell fairly quickly as a result.
Keizer’s biggest problem right now is lack of sales volume.
Sales in Keizer just aren’t down from the bubble, but they are down from the early part of the decade. Keizer was averaging 147 home sales in the 2nd quarter in the early part of the decade. Compare that with the 66 that occurred this quarter. That is 55% off from the non-bubble period. Normally that would send shivers up and down my spine, but the plunge in price brings Keizer almost back to normal. The current Keizer real estate inventory is a mere 7.28 months. Remember 6 months is that magical “neutral” market and Keizer is almost in it.
Unlike Salem Oregon builders that built homes for non-existent buyers, Keizer Oregon did not have the plethora of new construction homes saturating the market. So it makes sense that they are one of the first areas showing good signs of real estate stabilization.
Um, isn’t a dearth a lack of something? I think you mean that Keizer didn’t have the plethora of spec homes, not a dearth . . .
Yes. plethora is the word I was thinking…That’s what I get for blogging at midnight. Corrected!