Portland Market Update

Portland Market Update Mid-Year Residential Highlights

Wednesday, August 9th, 2017

August 10, 2017

Year to Date Summary.  Activity has been cooler so far in 2017 compared to 2016. New listings (21,505) are down 1.8%, closed sales (14,866) are down 3.9%, and pending sales (16,572) are down 7.2%.  Realtors and other market observers will be looking closely at fall sales as a bellwether for the 2018 market.  (See our Notes from Shannon and Jeanne for details.)

Average and Median Sale Prices.  Prices continued to rise in the Portland Metro area during the first half of the year.  Comparing prices through June 2017 to June 2016, the average sale price rose 9.8% from $388,800 to $427,000.

 

Mid-Year 2017 Average Residential Sales Price and Appreciation by Area


Inventory moved up incrementally to 1.6 months in June.  The average number of days a property stayed on the market before going under contract (“pending”) was only 38 days.

Year 2016 Residential Highlights

Tuesday, February 21st, 2017

Portland Area Housing Market Tops the List.  According to Zillow, the Portland area had the nation’s fastest growing housing prices in 2016.  Zillow said that the average Metro-area home value rose to $354,000 in December, marking a 13.8% increase from December 2015.  In related news, the S&P CoreLogic Case-Shiller Composite Home Price Index reported Seattle, Portland, and Denver scored the highest 2016 year-over-year gains among the 20 cities in the index; among the 20 largest cities in the US, just Portland and Seattle saw double-digit appreciation in 2016.

 

2016 Average and Median Sale Prices.  Comparing 2016 to 2015 through December, the RMLS of Oregon reported that the average Portland-area home sales price rose 11.4% from $354,500 to $395,000.  In the same comparison, the median sale price rose 12.7% from $308,000 to $347,000.  (I see the discrepancy between the Zillow figure and the RMLS figure and I’m at a loss to explain it.  Shannon)

 

Portland Market Update

Thursday, September 29th, 2016

Metro Highlights

September 29, 2016

Average and Median Sale Prices.  Prices continue to rise in the Portland metro area. Comparing 2016 to 2015 through August, the average sale price rose 11.2% from $353,200 to $392,600. In the same comparison, the median sale price rose 12.5% from $305,000 to $343,200.

9-29-av-med-sales-price-graph

August 20, 2016 Average Residential Sales Price and Appreciation1 by Area

market-update-table-9-29

Inventories Have Picked Themselves off the Floor, a Little.  We’ll see inventories pick up through the rest of the year, albeit marginally.   Look for the best buying opportunities in a year come November. 1 Percent change is based on a comparison of the rolling average sale price for the last 12 months (8/20/2015 – 8/20/2016) with 12 months before (8/20/2014 – 8/20/2015)

Inventory in Months, Portland Metro Area

Year 2015 Residential Highlights

Monday, February 8th, 2016

2015 Year in Review: New Market Highs (Again), Worrisome Inventory Numbers (Again).   

The Portland metro area ended the year with an uptick in closed sales this past December. The 2,710 closings surged 21.0% past the 2,239 closings posted in December 2014 and 25.9% past the 2,153 closings posted in November 2015. This was the strongest December for closings in the Portland metro area ever recorded by the RMLS, dating back to 1992.  Pending sales (1,936) were 16.1% stronger than in December 2014 (1,667) but fell 22.7% from the 2,504 offers accepted in November 2015.  The culprit: low inventories (see below).  December listings (1,538) were down 28.4% from the 2,148 new listings that came to market in November 2015.  The culprit: the market’s ordinary year-end holiday slowdown.  As of the date of this Update there is a total of just 2,495 active residential listings in the Portland metro area.

Average and Median Sales.  We’ll mark 2015 as the year the housing recovery brought prices back to pre-Recession levels.  Comparing 2015 to 2014, the average sale price rose 6.5% from $333,000 to $354,500. In the same comparison, the median sale price rose 7.9% from $285,500 to $308,000.

Average and Median Sales Price

Year 2011 Average Residential Sales Price and Appreciation1 by Area

AREA Average Sales Price Appreciation 1
NORTH PORTLAND $335,000 14.8%
NE PORTLAND $376,700 8.3%
SE PORTLAND $330,100 9.0%
GRESHAM/TROUTDALE $263,000 8.1%
MILWAUKIE /CLACKAMAS $335,600 8.2%
OREGON CITY/CANBY $325,200 8.6%
LAKE OSWEGO/WEST LINN $541,800 2.8%
WEST PORTLAND $495,100 5.3%
NW WASH. CO. $442,700 5.7%
BEAVERTON/ALOHA $297,300 7.1%
TIGARD/WILSONVILLE $370,600 9.6%
HILLSBORO/FOREST GROVE $271,500 10.6%
COLUMBIA CO. $226,600 7.0%
YAMHILL CO. $2267,100 5.6%

1 Percent change is based on a comparison of the rolling average sale price for the last 12 months (1/1/2015 – 12/31/2015) with 12 months before (1/1/2014 – 12/31/2014)

Low Inventories Continue to Define the Market Recovery.  December 2015 set another record of sorts: inventories of available homes fell to 1.2 months, the lowest inventory number since 1999 at least and a 17-year record.   Reciting from last year’s residential highlights, the same elements which have kept inventories persistently low for the past 3 ½ years are still working their juju on the market:  (1) in spite of rising home sales prices, many home owners are reluctant to bring their properties to market, for fear they will have nowhere to move; (2) other home owners are reluctant to sell because they’ve recently refinanced and can’t afford to sell quite yet; and (3) new construction starts still can’t keep up with demand.

inventory in months

Take a look at our “Notes. . ,” and watch us stick our necks out when we bring you our 2016 Market Outlook.

October 2015 Residential Highlights

Thursday, November 19th, 2015

Following the September 2015 trend, October brought some cooling to real estate activity in the Portland metro area.  While market watchers are divided over the explanation for the slowing trend, most agree that it’s a blip on the screen and that the market will resume its rise in the coming Spring 2016 market.  (Some observers cite buyer fatigue as the cause for the slowing trend, others attribute it to the season: with Thanksgiving right around the corner many home buyers have put aside moving plans in favor of making preparations for the coming holidays.)

As we discussed in our renent Notes from Shannon and Jeanne, inventories of homes – one of the hallmarks of the Great Recovery – have remained at historically low levels all year.

1-151117 Notes from Shannon and Jeanne for JPG_Page_2_Page_1

As a reminder to long-time readers of our Notes. . . and as an explanation for the benefit of recent arrivals to this page, Inventory in Months is a common measurement of market demand.  It’s a hypothetical model that measures housing supply vs housing demand by calculating the rate that inventories of homes are being absorbed by buyers.  Based on the rate homes were taken out of the inventory in October 2015, we only have 1.8 months’ supply of homes left to meet buyer demand.  A market is considered to be in balance between supply and demand, or sellers and buyers if you will, when there is something in the range of 5-to-8 months’ housing supply.

 

Average and Median Sale Prices.  Prices continued to rise in 2015 compared to 2014. Comparing each year through October, the average sale price rose 6.1% from $333,200 to $353,400. In the same comparison, the median sale price rose 7.0% from $285,000 to $305,000.  North Portland has lead Metro-area appreciation with a 13.3% posted gain; Tigard/Wilsonville (8.9%); SE Portland (8.6%); Oregon City/Canby (8.2%); and NE Portland (7.4%) were among other areas showing the strongest gains.

Average and Median Sales Price

 

January 2015 Residential Highlights

Thursday, January 29th, 2015

2104 Year in Review: New Market Highs, Worrisome Inventory Numbers.   Portland metro activity ended 2014 higher than 2013 numbers in all measures. New listings (37,654) were up 5.0%, pending sales (28,220) were up 4.3%, and closed sales (27,752) were up 3.6% during the whole of 2014 compared to the same time period in 2013.  Average and Median Sale Price were higher in 2014 than in 2013. The average price in 2014 was $333,000, up 7.2% from 2013 when the average was $310,600. In the same comparison, the median sales price also rose 7.7% from $265,000 in 2013 to $285,500 this past year.  How does our average $333,000 sales price compare with Seattle’s?  Check out our “Notes from Shannon and Jeanne” for this month’s cool factoid, and for a look at what your intrepid reporters see coming our way in 2015.

Average and Median Sales Price

 

Year 2011 Average Residential Sales Price and Appreciation1 by Area

AREA Average Sales Price Appreciation 1
NORTH PORTLAND $291,600 9.4%
NE PORTLAND $348,600 6.9%
SE PORTLAND $303,300 12.5%
GRESHAM/TROUTDALE $243,100 8.5%
MILWAUKIE /CLACKAMAS $310,500 10.4%
OREGON CITY/CANBY $299,500 10.2%
LAKE OSWEGO/WEST LINN $527,500 9.5%
WEST PORTLAND $470,200 5.9%
NW WASH. CO. $418,300 5.7%
BEAVERTON/ALOHA $277,300 6.7%
TIGARD/WILSONVILLE $338,300 7.3%
HILLSBORO/FOREST GROVE $271,500 10.6%
COLUMBIA CO. $211,900 11.9%
YAMHILL CO. $253,100 5.0%

1 Percent change is based on a comparison of the rolling average sale price for the last 12 months (1/1/2014 – 12/31/2014) with 12 months before (1/1/2013 – 12/31/2013)

 

Arrested Development.  In October we reported there were signs that depressed inventories were finally rising, and bringing with them the prospect of a cooling trend in housing prices.  But an unexpected easing of mortgage interest rates and a flurry of December sales brought the hammer down on inventories again, and we closed the year with the lowest inventory levels in the past seven years.   Mortgage interest rates have continued to drop: at the time of this writing the 30-year conventional fixed rate is almost touching 3.5%.  That’s nearing the historic 2012-2013 federally subsidized lows.  And many of the elements which have kept inventories persistently low are still in place:  in spite of rising home sales prices, many home owners are still reluctant to bring their properties to market.   And other home owners are unlikely to sell because they’ve taken advantage of low interest rates and have recently refinanced and frankly can’t afford to sell quite yet.  And building starts can’t keep up with demand.

Inventory in Months, Portland Metro Area

2008 2009 2010 2011 2012 2013 2014
January 12.9 19.2 12.6 11.3 7.0 4.7 4.1
February 10.4 16.6 12.9 10.9 6.5 4.5 3.9
March 9.1 12.0 7.8 7.1 5.0 3.2 3.1
April 10.3 11.0 7.3 7.2 4.7 3.1 2.8
May 9.2 10.2 7.0 6.8 4.2 2.5 2.8
June 9.5 8.2 7.3 6.0 3.9 2.9 2.8
July 10.0 7.3 10.8 7.0 4.6 2.8 2.9
August 9.9 7.8 11.0 6.2 3.9 3.1 3.0
September 10.4 7.6 10.5 6.7 4.6 3.7 3.1
October 11.1 6.5 10.7 6.8 3.8 3.4 2.8
November 15.0 7.1 10.2 6.2 4.2 3.7 3.2
December 14.1 7.7 7.9 5.3 3.6 3.2 2.3

Take a look at our “Notes. . ,” and watch us stick our necks out when we bring you our 2015 Market Outlook.   Happy New Year!

 

September 2014 Residential Highlights

Wednesday, October 29th, 2014

Fall Report: Metro-area Price Appreciation, Sales Continue to Taper Off.  Metro-area real estate showed more signs of a taper in prices and activity in September.  The downward trend in market activity has persisted into its third month, but numbers continue to be strong for the year overall.  Read past the RMLS’ reporting numbers to get our take on the trend.

Pending sales (2,551) bested last September (2,219) by 15.0%, although they are also 5.7% cooler than August’s 2,704 accepted offers. A little perspective may help here:  this past month was the strongest September for pending sales in the area since 2006. Closed sales (2,378) similarly fared 10.2% better than the 2,158 closings recorded last September but cooled 8.0% compared to the 2,586 closings in August. The 3,102 new listings posted in September represent a 6.1% growth from September 2013 but a 13.4% decrease from August.  (Reporting courtesy RMLS of Oregon)

Average and Median Sale Prices. The average price the first nine months of the year was $333,000, up 7.4% from the same time frame in 2013 when the average was $310,000. In the same comparison, the median also rose 7.5% from $265,000 in the first nine months of 2013 to $285,000 in the same period of 2014.  (Cool factoid: there are currently 7,438 active residential listings in the Portland metro area.)

Average and Median Sales Price

Winds of Change: Rising Inventories May Signal A Shift in the Weather.  For the past 24 months home prices have been pushed by persistent low inventories and a stable, low interest rate climate.   Starting in July though inventories of homes started a slow but steady rise (see chart).  Rising inventories will take some of the competitive heat off the market and should contribute further to the cooling trend in house prices.  Don’t expect that the housing inventory will grow in leaps and bounds however.  New home construction is not moving ahead quickly enough to meet demand – and it will not do so for several years.  And in spite of rising home sales prices, home owners have been reluctant to bring more homes to market.  Many are still underwater on their mortgage or barely have enough equity in their home to sell without losing money.  And others are unlikely to sell because they’ve taken advantage of low interest rates and have recently refinanced.

Inventory in Months, Portland Metro Area

2008

2009

2010

2011

2012

2013

2014

January

12.9

19.2

12.6

11.3

7.0

4.7

4.1

February

10.4

16.6

12.9

10.9

6.5

4.5

3.9

March

9.1

12.0

7.8

7.1

5.0

3.2

3.1

April

10.3

11.0

7.3

7.2

4.7

3.1

2.8

May

9.2

10.2

7.0

6.8

4.2

2.5

2.8

June

9.5

8.2

7.3

6.0

3.9

2.9

2.8

July

10.0

7.3

10.8

7.0

4.6

2.8

2.9

August

9.9

7.8

11.0

6.2

3.9

3.1

3.0

September

10.4

7.6

10.5

6.7

4.6

3.7

3.1

October

11.1

6.5

10.7

6.8

3.8

3.4

November

15.0

7.1

10.2

6.2

4.2

3.7

December

14.1

7.7

7.9

5.3

3.6

3.2

 

Geopolitical Instability, a Weakening Global Economic Recover, and Health Fears Push Interest Rates Down.   Recent worries about the situation in the Middle East, the chill on the global economic recovery, and unallied fears about the ebola epidemic have had an unintended favorable consequence: at the time of this writing the benchmark 30-year fixed rate conventional loan, testing the under-four-percent mark, is the lowest it has been in 16 months.   There’s widespread belief though that once the economic recovery regains its stride we’ll see lessening federal influence over rates in the months ahead of us.  And that will set the stage for a long-anticipated rise in mortgage rates.

In the meanwhile, the cooling trend is welcome news to home buyers frustrated by rising prices and bloody bidding wars.  And the trend should combat fears that we’re building into another worrisome real estate bubble.  In the long view, look ahead to the coming months as a repeat of the Same Old Story:  for years we’ve suffered a Catch-22 recovery that delivers low interest rates and a favorable housing outlook when job growth and wages are stagnant, and higher interest rates and housing unaffordability when jobs and wages are on the upswing.   It’s these writers’ opinion that our see-saw recovery will persist at least another two or three years.  Hang on for the ride; we’ll be right here alongside you!

 

 

May 2014 Residential Highlights

Friday, June 20th, 2014

Prices Continue Their 2-Year Climb.  [Reporting  period: May, 2014.  Source: RMLS of Oregon].  Devastatingly low inventories and persistent low interest rates have pushed demand – and prices – for Portland housing to new highs.  In its most recent “Market Action” newsletter the RMLS of Oregon reports that May sales pushed the average price for metro-area homes up 9.1% from the same time a year ago, to $327,200.  Among the high-scorers, north Portland is up 15.1%; southeast is up 14.5%, northeast is up 11.7%, Milwaukie/Clackamas is up 12.9% and Oregon City/Canby is up 14.4%.  Among the laggards, Lake Oswego / West Linn is up 7.2%, west Portland is up 6.1%, and northwest Washington County is up 8.0%.

Average and Median Sales Price

Year-to-Date SummaryThe market has cooled, barely cooled, compared to 2013, and the culprit is not demand, but inventory.  Market watchers, including these writers, believe that the decline in pending and closed sales is coupled to the relatively limited number of homes for sale: inventories of homes for sale have fallen to near-record lows again, to 2.8 months in April and May.  There simply aren’t enough houses for all the buyers in the marketplace at this time.  As a consequence bidding wars have become commonplace again.

Inventory in Months, Portland Metro Area

2008

2009

2010

2011

2012

2013

2014

January

12.9

19.2

12.6

11.3

7.0

4.7

4.1

February

10.4

16.6

12.9

10.9

6.5

4.5

3.9

March

9.1

12.0

7.8

7.1

5.0

3.2

3.1

April

10.3

11.0

7.3

7.2

4.7

3.1

2.8

May

9.2

10.2

7.0

6.8

4.2

2.5

2.8

June

9.5

8.2

7.3

6.0

3.9

2.9

July

10.0

7.3

10.8

7.0

4.6

2.8

August

9.9

7.8

11.0

6.2

3.9

3.1

September

10.4

7.6

10.5

6.7

4.6

3.7

October

11.1

6.5

10.7

6.8

3.8

3.4

November

15.0

7.1

10.2

6.2

4.2

3.7

December

14.1

7.7

7.9

5.3

3.6

3.2

Interst Rates

 

Interest rates are trending pretty steadily.  This graph, courtesy National Association of Home Builders, illustrates interest rate history going back to 1990.  The line has been wobbling between 4.0% and 4.5% for several months.  And there’s widespread belief that continuing economic recovery and lessening federal influence over rates has set the stage for an anticipated rise beginning late this year.

Portland Market Update

Tuesday, February 11th, 2014

2014 Residential Highlights

Big News: The average sales price through the end of 2013 ran all the way up to $310,600, up 12.9% from the same period in 2012, when the average was $275,000.  In the same comparison, the median price increased 12.8% from $235,000 in 2012 to $265,000 to end 2013 [Reporting period: January 15, 2014].

Year-to-Date Summary.  There were 27,065 accepted offers and 26,782 closed sales in 2013, up 12.7% from 24,010 pending sales and 14.3% from 23,438 closed sales in the same period in 2012.  The 35,858 new listings in 2013 represented an 11.0% increase from the 32,300 entered through the end of 2012.

 

Average and Median Sales Price

Inventory fell at the end of 2013 back down to 3.2 months, and total market time – the number of days from when a property is listed to when an offer is accepted – increased incrementally to 83 days the last month of the year.

 

Inventory in Months, Portland Metro Area

2007

2008

2009

2010

2011

2012

2013

January

6.2

12.9

19.2

12.6

11.3

7.0

4.7

February

5.2

10.4

16.6

12.9

10.9

6.5

4.5

March

3.8

9.1

12.0

7.8

7.1

5.0

3.2

April

4.4

10.3

11.0

7.3

7.2

4.7

3.1

May

4.5

9.2

10.2

7.0

6.8

4.2

2.5

June

5.0

9.5

8.2

7.3

6.0

3.9

2.9

July

5.7

10.0

7.3

10.8

7.0

4.6

2.8

August

6.2

9.9

7.8

11.0

6.2

3.9

3.1

September

8.6

10.4

7.6

10.5

6.7

4.6

3.7

October

8.4

11.1

6.5

10.7

6.8

3.8

3.4

November

8.3

15.0

7.1

10.2

6.2

4.2

3.7

December

8.5

14.1

7.7

7.9

5.3

3.6

3.2

September Residential Highlights

Tuesday, October 29th, 2013

September housing prices and activity show signs of seasonal slowing.  [Reporting period: September 15, 2013].  Price appreciation slowed slightly in September as the market, overheated since January, moved into an anticipated seasonal slowdown.  New listing activity, the life-blood of our housing market, fell 14.5% from the previous month, from 3,423 to 2,925, but we must keep things in perspective: that 2,925 figure marks a 19.3% increase over the 2,451 homes listed in September 2012.  Closed sales, at 2,158, decreased by 17.7% compared to August, when there were 2,623. Nevertheless, this was the best September since 2006, when RMLS™ counted 2,506 closings.

The average sales price for September was $317,300, off .14 percent from August’s $321,900 and .28 percent off August’s $326,500 high water mark.  But again, a little perspective is in order: September’s figure is up 14.2% from the same period in 2012, when the average was $272,200.

average and median sales price

Inventory has increased slightly to 3.7 months, and total market time – the number of days from when a property is listed to when an offer is accepted – is currently 72 days.

Inventory in Months, Portland Metro Area

2007

2008

2009

2010

2011

2012

2013

January

6.2

12.9

19.2

12.6

11.3

7.0

4.7

February

5.2

10.4

16.6

12.9

10.9

6.5

4.5

March

3.8

9.1

12.0

7.8

7.1

5.0

3.2

April

4.4

10.3

11.0

7.3

7.2

4.7

3.1

May

4.5

9.2

10.2

7.0

6.8

4.2

2.5

June

5.0

9.5

8.2

7.3

6.0

3.9

2.9

July

5.7

10.0

7.3

10.8

7.0

4.6

2.8

August

6.2

9.9

7.8

11.0

6.2

3.9

3.1

September

8.6

10.4

7.6

10.5

6.7

4.6

3.7

October

8.4

11.1

6.5

10.7

6.8

3.8

November

8.3

15.0

7.1

10.2

6.2

4.2

December

8.5

14.1

7.7

7.9

5.3

3.6