What's Happening in the Portland Market
Let's talk about the Portland housing market a bit. Rates are down and so is inventory from this time last year. I'm often asked if this is the right time to buy or sell. If you are ready, then yes would be my simple answer. But, how can I make a blanket statement like that? Read on.
Real estate is a long-term investment. When seeking to invest, you should consider what will happen over the next five years. Two years ago - around the height of the seller’s market, buyers asked if the market was in a bubble and if they should wait for it calm down. Here we are two years later - the market is cooling and the value of homes decreasing. Values are down about 1% city-wide average the year and are predicted to decrease another 1.5% in the year to come. This trend is expected to continue through 2020. This comes after about 25% of appreciation over the 3 years. So, if you held out, you just walked past a dollar to pick up a dime.
Even with the continuing downturn, I don’t expect home values to plummet to a point that would suggest it wise to wait. Values might decrease, but I still expect offered to be at, or just above asking for many sellers. Why? Because this market cooling is cyclical and expected. Homes will continue to appreciate after the market adjusts. Portland is seeing a population boom and it’s not based solely on the affordability of homes compared to other west coast markets. Keep in mind the housing market in Seattle and San Francisco are far harder to compete in, making Portland an ideal location for growth in the PNW.
If you were someone who got caught up going over appraised value on that quirky home on a busy street - or even worse, paid well over with cash and waived the appraisal - don't expect to grow your equity anytime soon. This is why we need to see the investments in our homes, even in aggressive markets as long term. Portland homes appreciated an average of 5% in the last 10 years and 4% in the past 12.
Portland has growing job markets, both in and outside of tech. It’s still desirable for young professionals looking for a place to start adulting and compared to San Francisco and Seattle you get way more bang for your buck. SO, moving forward… Yes, the market is cooling but it is still a seller’s market for most of the Portland Metro area. Sellers are still seeing multiple offers and they are often well over asking. Yes, if you plan to be in the home for 5 or more years (remember - long-term investment).
From the perspective of a Real Estate Broker who is in the streets every day helping folks buy and sell I’ll say this: For sellers - compared to years prior, you may have to spend a little more money making your well-lived-in home more marketable to a larger buyer pool. Buyers are seeing the cooldown and feel they have Moore negotiating power - and they’re right. This is no longer the buying frenzy we were experiencing over the last few years. Your home has appreciated well and it’s still more than likely your biggest asset and a great investment. The inventory and active buyers still point the needle to the seller's advantage. Be willing to negotiate but in no way should you prepare yourself to get rolled. This is still a seller's market. Buyers - be happy that you no longer HAVE to go well over to get into a house that is too small, in the wrong neighborhood, or requires all the cask just to compete. If the house is in good shape and in the right neighborhood, expect to duke it out with a few other buyers and expect to go a little over asking. This is not the market to go well under and expect to get an accepted offer. Believe me, when that time comes - I will tell you. Now is not that time. In my opinion, this is the closest market too fair that we’ve seen in a very long time. Get out there and enjoy it. If you need help navigating it, go ahead and give me a call. Always happy to help you through it.
