If 2023 was the year of rate shock and 2024 was the year of adjustment, then 2025 was the year Central Oregon’s housing market began finding its footing. Not with a bang. Not with a crash. Just a slow, occasionally frustrating grind toward normalcy. Here’s what happened, what we got right, what we got wrong, and what it sets up for 2026.
The Year in Numbers
- Total SFH closings (Deschutes County): 2,410 (up 4.2% from 2,313 in 2024)
- Median sale price (Deschutes County): $610,000 (up 2.5% from $595,000)
- Average days on market: 55 (up from 48 in 2024)
- Inventory (year-end): 820 active SFH (up from 715 at year-end 2024)
- Months of supply (year-end): 3.2 (up from 2.7)
- Sold-to-list ratio (annual average): 97.4% (down from 97.9%)
- Mortgage rate range: 6.13% to 7.26%
The Mortgage Rate Roller Coaster
If there’s one theme that defined 2025, it was mortgage rate volatility. The year started with rates around 6.6%, dropped to 6.13% in March on recession fears, rebounded above 7% by July as inflation data came in hot, peaked at 7.26% in October, and then eased back to 6.4% by year-end as the economic outlook softened.
That volatility had a direct and measurable impact on Central Oregon’s market. In the months where rates were below 6.5% (March-April, November-December), buyer activity surged. In the months where rates were above 7% (July-October), activity dropped noticeably. The correlation between rate levels and showing activity was nearly linear.
The average rate for the year was 6.64%, which happened to be right at the threshold where we’ve observed market activity shifting gears. Below 6.64%, the market felt functional and active. Above it, things slowed. Central Oregon spent roughly half the year on each side of that line.
City by City Highlights
Bend
Median price: $672,000 (up 2.0%). Closings: 1,480 (up 3.8%). The west side continued its premium pricing, but the gap between west-side and east-side Bend widened. NorthWest Crossing and Shevlin area homes averaged $825,000+, while southeast Bend offered options in the $475,000-$575,000 range.
Redmond
Median price: $452,000 (up 3.5%). Closings: 585 (up 6.2%). Redmond was the growth story of 2025, both in terms of new construction and resale activity. Its value proposition relative to Bend is attracting a growing share of first-time buyers and families.
Sisters
Median price: $630,000 (up 1.2%). Closings: 85 (down 2.3%). Sisters remains constrained by geography and planning regulations. Demand is strong but supply is limited, which keeps prices elevated but suppresses transaction volume.
Sunriver
Median price: $555,000 (down 2.4%). Closings: 128 (down 5.9%). The vacation-home segment had a tough year. Higher rates reduced the buyer pool for second homes, and regulatory uncertainty around short-term rentals dampened investor interest.
La Pine
Median price: $370,000 (up 5.7%). Closings: 210 (up 9.4%). La Pine posted the strongest percentage gains in both price and volume. Affordability is the draw, and improvements in infrastructure and amenities are making it a more attractive option for full-time residents.
Notable Market Moments
March: Rates hit 6.13%, the lowest point of the year. Buyer activity spiked. Multiple offers returned briefly in the most competitive Bend neighborhoods.
June: New listing activity peaked for the year, with inventory briefly touching 950 units in Deschutes County. It felt like the supply side was finally catching up.
October: Rates hit 7.26%. Pending sales fell 18% month over month. Several Bend neighborhoods saw price reductions exceed new listings for the first time since early 2023.
November-December: Rates pulled back to the mid-6% range, and buyer activity rebounded heading into the holidays. Year-end closings came in stronger than most forecasts had predicted.
What We Got Right
In our 2024 year-end forecast, we predicted moderate price appreciation (2-4%), gradually rising inventory, and transaction volumes roughly flat to slightly up. Those predictions landed close to actual results. We also called the continued normalization of days on market and the shift in negotiating leverage toward buyers, both of which played out.
What We Got Wrong
We underestimated the degree of rate volatility. Our forecast assumed rates would settle into a narrower range, but the 113-basis-point swing from the year’s low to high was wider than anticipated. We also overestimated new construction completions, which came in about 10% below our projections due to continued labor constraints and permitting delays.
Honesty about forecast misses matters. If we only told you about the predictions we nailed, you shouldn’t trust any of our analysis.
Outlook for 2026
Based on current trends and leading indicators, here’s what we expect:
- Prices: 2-3% appreciation across Central Oregon, with Redmond and La Pine at the high end and Sunriver flat to slightly down
- Rates: Forecast range of 5.75-6.75%, with most of the year likely in the 6.0-6.5% band
- Inventory: Continued gradual increases, with Deschutes County potentially reaching 1,000+ active listings by mid-year
- Transaction volume: Up 5-10% from 2025, driven by improved rate conditions and pent-up demand
- Market balance: Movement toward balanced conditions by late 2026, particularly in Redmond, Crook County, and Jefferson County
For current data and ongoing analysis, visit our housing market section. Read our detailed reports for city and county breakdowns. And as always, our team is here to help you navigate whatever 2026 brings.