Phil Duarte, left, and Allen Hansen, both of MDA Construction in Medford, build the foundation of a home on Park Ridge Drive in East Medford. - Photo by Denise Baratta

A step in the right direction

Sales activity has slowed and prices are down, but the number of housing permits issued in Jackson County during the first five months of 2007 suggests there is underlying optimism in some quarters.

The latest Housing Department figures, through May, show that 486 single-family residence building permits were issued in the county, just eight less than a year ago and well above the 390 issued for the first five months of 1997 before the market got red hot. While it's nowhere near the 582 single-family structure permits issued in 2002 when the housing boom headed into its peak, the numbers show builders are still on the job.

The way Mahar Homes President Randy Jones sees it, the current mixed market is beneficial.

"There is an abundance of product in some price ranges, more product than there should be," Jones says. "Probably this time next year things will look more solid. We're actually in a more normal, more real market."

Statewide, there were 10,019 single-family dwelling permits issued through May 30. That's 14 percent off last year's pace for the first five months, but on par with 10 years ago and actually ahead of 2002's pace.

"We're not going to be quite as aggressive," Jones says. "We're in a good market, but not great, and I think pricing is going to be more reasonable. We're not building as many spec houses, but we're still building them. I think we have 10 going at different stages, two years ago we had 20 at the same time. We have eight pre-solds going compared to 15 or 16 we were doing two years ago."

Jones says the quality of housing stock may have suffered in some quarters during the boom years. As subcontractors became general contractors, it became harder to find reliable subcontractors.

"The sub-trade pool is only so big and some houses didn't get built as well," he says. "I think products are going to be better now, people aren't as tired and they are appreciating what they're doing."

While buyers have more choices in more places around the county to buy new houses than ever before, more and more builders are waiting to pre-sell a house before diving into construction. From Summerfield in southeast Medford to Bella Vista Heights a little farther north, to Twin Creeks in Central Point and White Oak Ridge in Shady Cove, lots are readily available.

"There's a lot of inventory between new construction and existing housing," says Stacey Boals with First Charter Realty. "My guess is that the perception when people are driving around is that we must be depressed, but I don't think it's a slow market.

Boals is marketing Bella Vista Heights, developed by Jeff Chamberlain off East McAndrews Road, overlooking RoxyAnn Vineyard. The 30-acre project's 107 view lots range from 7,600 square feet to more than a half-acre.

"Builders know exactly how many pennies go into a house and know their costs," Boals says. "Making yourself competitive in today's market is more than a matter of thinking what you could get. We went through inflated prices for a while, I see this as more of a normalization period."

While about a third of the Bella Vista Heights lots — which list for as much as $650,000 — have sold, 34 lots on a bluff not far from the Rogue River in Shady Cove remain largely undiscovered.

White Oak Ridge, a 17-acre development by Ron Boehm, features inclusion in Eagle Point Waterworks and Avista natural gas. The lots, put on the market for $150,000 in February, are now listed at $135,000.

"It's a gated community with some stiff CC&Rs (covenants, conditions and restrictions)," says Mike Malepsy of Windermere Trails End Real Estate. "The initial response was good, but the pricing was too high. There is 2,200-square-foot minimum house, the plans have to go through architectural review and there is a homeowners association."

Many potential buyers from California have not been able to sell their home, Malepsy says. "That slows the process."

With so many prime lots available, buyers are in the driver's seat and builders will bide their time when possible.

"I expect permits to drop the second half of the year," says Jones. "I'm not seeing anything that says we're going to get a pick-up the rest of the year. I think it's going to stay kind of flat, that's not a bad market, not doom and gloom. But for somebody sitting there with three or four houses that haven't sold, it's a depression. It's their reality and it's happened to a few people."

Reach reporter Greg Stiles at 776-4463 or at

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