Bend, Oregon, often romanticized as a magnet for outdoor enthusiasts and retirees, finds itself at a pivotal moment. At a recent economic outlook meeting hosted by Brian Ladd of Cascade Hasson Sotheby’s International Realty, key insights emerged about the region’s growth, housing market, and economic trajectory. Damon Runberg, State Economist for Business Oregon, shared data-backed perspectives that challenge assumptions about the area’s explosive growth during the pandemic and reveal critical challenges ahead.
Myth-Busting: Bend’s “Zoom Town” Label
Contrary to the widespread belief that Bend became a hotspot for remote workers during the pandemic, population growth data paints a different picture. Runberg revealed that Bend’s annual growth rate slowed significantly during the pandemic years, hovering around 1.5%—a stark contrast to its double-digit peaks in the early 2010s.
“The idea that Bend saw a massive influx of new residents during the pandemic is not supported by the data,” Runberg noted. Instead, much of the housing frenzy during that time was driven by second-home buyers and existing residents taking advantage of low interest rates.
Affordability Crisis: The Elephant in the Room
Runberg highlighted a stark reality: it takes over 10 years of the average local wage to afford a median-priced home in Deschutes County. For context, this ratio is far higher than the state average and comparable to affordability challenges in places like Hawaii.
“Housing affordability isn’t just a local issue—it’s a barrier to economic growth,” Runberg explained. “Businesses are struggling to attract talent because workers can’t afford to live here.”
Brian Ladd echoed these sentiments, noting that local governments are finally addressing the housing shortage. Efforts include loosening land-use restrictions and fast-tracking developments, but these solutions will take years to bear fruit.
Inventory and Housing Prices: A Delicate Balance
Despite recent increases in inventory, Bend remains in a state of undersupply. The region has about 5.3 months of housing inventory—just within the range considered a balanced market. Historically, price corrections occur when inventory exceeds 9 to 10 months.
“Housing prices are sticky,” Runberg said, referring to the economic concept that prices tend to rise quickly but drop slowly. With unemployment at historic lows and many homeowners locked into sub-3% mortgage rates, there’s little urgency for distressed sales that could drive prices down.
Interest Rates and the Waiting Game
Mortgage rates, a top concern for prospective buyers, were another focal point. While some economists predict rates could fall to between 5.5% and 6% by 2025, uncertainty looms. Runberg emphasized the importance of stability over volatility: “Predictability in rates could do more to stimulate the market than any specific number.”
Ladd added a practical perspective for would-be buyers: “If you’re waiting for the perfect rate, you might be disappointed. Make decisions based on your current financial situation and long-term goals, not market timing.”
The Path Forward
Both speakers underscored the need for more housing—across all price points. Runberg pointed to the success of new multifamily developments in softening rental prices, a sign that increasing supply works. However, with construction costs still high and land-use restrictions limiting sprawl, the pace of progress remains slow.
“The reality is that solving Bend’s housing crisis will take a concerted effort from developers, policymakers, and the community,” Ladd concluded.
Blog created in collaboration with Gary Nolan – Chief Marketing and Strategy Officer at Cascade Hasson Sotheby’s International Realty