Bend booms in building frenzy
Thursday, July 21, 2005
MATTHEW PREUSCH
BEND -- If you hike the winding mile to the top of Pilot Butte on the city's east side, you might get the impression that someone's scattered surplus Monopoly pieces across the high desert.
People here are building houses in record numbers. East, west, north and south -- new homes are spreading out from downtown Bend in every direction.
Deschutes County is one of the nation's fastest-building counties: It's No. 40 on a list of the top 100 counties for single-family home construction in data released today by the U.S. Census Bureau.
"Anyone who is in any way connected to homes in Central Oregon is riding the wave," said Eric Keyes, an employee of a local home inspection company.
Deschutes County added more than 3,000 new homes from July 2003 to July 2004 for an increase of nearly 5 percent. That's more than three times the state and national average -- both at 1.4 percent -- and about two times more than the next highest Oregon county, Jackson at 2.5 percent growth.
Four of the five leading states in housing starts were in the West, but Oregon wasn't among them at No. 20. The nation built 1.7 million new houses during that period, bringing the number of houses to 122.7 million overall, the census showed.
The building trend shows no signs of slowing down as the Bend area struggles to keep up with the demand of its burgeoning population.
"Builders are operating at capacity," said Dave Wilson, president of the National Association of Home Builders in Washington, D.C. "With mortgage rates and other market conditions still very favorable, they see no let up through the summer months ahead."
In May, Deschutes County issued 314 building permits for single-family houses, outpacing both Washington County (304 permits) and Multnomah County (128). Many of the area's new homes are on the high end, thanks to the blossoming of destination resorts such as Eagle Crest and Pronghorn.
In Bend, where much of the region's growth has focused, the city issued about 1,600 permits last year and this year is on pace to break 2,000.
"Last year was a record, and the year before that was a record, and it just keeps going up and up," said Robert Mathias, Bend's building department supervisor. City permit workers are "buried to the gills," he said.
Each of Mathias' 20 inspectors does about 30 visits a day to sign off on mechanical, plumbing and electrical work or some other aspect of new home construction. "Typically, we want to see the numbers down to around about 14 or 15 a day," he said.
Mathias has scoured national statistics and can find no other city of less than 70,000 that has issued close to as many house permits as Bend.
But all the new housing supply hasn't helped moderate home prices.
"Not at all," said Kim Warner, a broker with Duke Warner Realty, which his father founded in Bend in 1967. "Surprisingly, there are buyers for all the new houses that are available."
The median home price in Bend was $258,000 in the first half of this year -- an increase of almost 60 percent since 2001 and about $33,000 more than the median price in the Portland area, according to Multiple Listing Service statistics.
Much of that is because of population growth: In 15 years, Bend has more than tripled in size, from about 20,000 people to 65,000, making it the eighth largest city in the state and the largest by far east of the Cascades.
Many of the new home buyers, Warner said, are coming from California.
That's where James and Lisa Lamberto moved from last month. They sold their 2,500-square-foot home in San Ramon for more than $1 million and bought a larger, newer home on a bigger lot for about half of that.
From their prairie-style home in the new Northwest Crossing subdivision on Bend's west side, it's a two-block walk to the park past houses in all states of completion along with bare lots awaiting buyers.
"It's exciting for us to go from a fixer-upper to a brand new home," Lisa Lamberto said, "because we could never afford a brand new home in California." The Lambertos are now working for a Bend real estate company owned by Lisa Lamberto's mother, Sage Signature Properties.
They aren't the only ones hoping to take advantage of the strong market. About 30 to 40 new agents hang their shingle in Bend and the surrounding area every month, Warner estimated. "It just seems to get better and better," he said.
And someone has had to build all those homes. Construction accounts for about 5 percent of jobs statewide, but that figure almost doubles in Central Oregon, according to the state Employment Department.
Even so, it's hard to find local subcontractors to do all the work, said Gretchen Palmer of Palmer Homes, a Bend homebuilder.
Every year the number of homes Palmer builds grows about 15 percent to 20 percent, making it difficult to secure enough carpenters, electricians and roofers to keep up, she said.
This past spring, Palmer said, she had to let two concrete foundations sit bare in southeast Bend while she searched out of the area for available framing crews.
"We are in a pretty tight building schedule," she said. "So we can't afford a blip."
Tim Knopp, a former state representative who now leads the Central Oregon Builders Association, said the number of builders, contractors, lenders and others in his group has grown more than 50 percent in the past 16 months to 768.
"This industry is booming right now," he said, "and they want to be a part of it and grab their share of the market if they can."
