Lennox was in Bend, Oregon August 20 for the grand opening celebration of our new office location. He was interviewed by the Bend Bulletin:
Bend home shortage to continue, expert says
CEO of John L. Scott Real Estate visits Bend to open office
By Joseph Ditzler / The Bulletin / @josefditzler
Lennox Scott never doubted his path into the family real estate business, he said Thursday.
He started at age 10, painting “For Sale” signs for the company his grandfather John L. Scott founded in Seattle in 1931. At age 22, he was running the company following the death of his father, also John L. Scott, in 1977.
Back then, it had 260 brokers. Today, John L. Scott Real Estate employs nearly 10 times as many in Oregon, Washington and Idaho. It brokered $9.8 billion in sales last year, said Scott, now chairman and CEO.
“We’re at a historic moment in time in real estate,” he said Thursday. “You have very strong job growth and low interest rates at the same time.”
Scott was in Bend on Thursday to open a new office at 50 SW Bond St., in the Old Mill Marketplace, where the firm relocated from NE Third Street. He said high demand is reducing the supply of lower-priced homes in Bend faster than new listings are appearing, and prices are climbing as a result.
Bend has a three-month supply of homes below $500,000, about half of what real estate brokers consider healthy. That price range accounts for 79 percent of all home sales, Scott said. And sales are heating up in the next higher price range — $500,000 to $750,000 — too.
“It starts in the more affordable price ranges,” he said. “It gets into the mid-price ranges — we now have a shortage — and now it’s starting to work its way to the beginning of the upper end.”
Scott said the “flat-out” shortage in the lower price range in Bend won’t improve anytime soon. It may continue into summer 2017.
One reason: Homeowners are staying put longer. They’re selling their homes every 10 years on average rather than every six years, Scott said. That means a 30 percent to 40 percent reduction in inventory.
“A lot of people found their home at low interest rates; they may have refinanced,” he said. “They’re not putting their home on the market because they may not be able to get their next home if it’s in the price range where there’s a shortage of inventory. So they’re holding back …”
Starting in October 2014, sales in Bend continued to outpace the number of homes coming up for sale, a trend that continued through the winter, Scott said. Without a pause to allow the real estate market to catch its breath, home prices continued a steady upward trend. He said the expected small increase in interest rates later this year will not impede that climb.
“Selection and availability this next two months is going to be a critical time,” he said.
Buyers and their brokers need to be “buyer-ready on day one” to get the home they want, Scott said. That means spending one to two hours counseling with a broker, being pre-approved for financing and willing to make a competitive offer for the home they want. A personal touch is also a good idea.
“Having a letter about yourself so the seller can know a little bit about who you are,” Scott said. “The seller, they want to feel good about who’s buying their home.”