I’m sending a quick update on the Portland housing market to dispel a couple of myths. See below for what this could mean for you.
First, two of the most frequent questions people ask me are; can this crazy housing market last, and what about the impending bust? Well, in the most recent market report gathered by RMLS, the data doesn’t support either one of those assumptions. First, the “boom.” The median sales price in Portland rose 2.2% over the past year. That’s a pretty steady, sustainable, un-boomish rate. Next, the “doom.” The market may crash at any moment, right? Nope. The demand in Portland remains steady with 2.3 months of inventory on the market. In addition, the increase in Portland population paired with an unmatched rate of new building permits (apartments aside) means that demand is projected to remain high.
So what does this mean? It’s a BALANCED market. This is great news! Buyers now have time to actually think about a home before writing an offer, and we’re not seeing nearly as many competitive offer situations. Sellers are still getting offers, but may have to negotiate more on pricing or repairs (little secret: this is normal!). And since most sellers are going to turn around and purchase a new home, this is great for sellers as well. It keeps them from being in a situation where everyone wants their home, but there isn’t anything to purchase. So if you or someone you know is ready to move up to their next house or downsize to something different, now is a great time to do it.
Median 12 month increase in sale price is 2.2%
Pending sales are down 1.1% compared to 2018
Homes average 48 days on the market before an accepted offer
If you’re interested, you can find the full report here.
There’s Merriam-Webster’s word of the year, “justice”. There’s the NBA’s coach of the year, which in our admittedly biased opinion should go to our own Terry Stotts. But did you know there’s also a color of the year? Pantone Color Institute, the color consultants that work with top brands to develop their design strategy, selects a color every year that reflects current trends. For 2019 they chose Living Coral, a warm, energetic tone that is perfect for spring and early summer. Now we are beginning to see that tone show up in consumer products. It may be a good idea to note this if you’re getting your home ready to sell. Why would that matter? Because when your home is on the market, a fresh look can leave a great impression on potential buyers.
We’re not saying you should paint your home that coral pink. In fact, please don’t, but it’s easy to pull it in as an accent color among neutrals or even in contrast with blues and greens. It doesn’t have to cost a lot, either. Take a quick stroll through Target, where the color can be found on display with blue and green contrasting pillows. Or you might find it in display pieces to replace any personal items and photos you remove for showings.
This color lends itself exceptionally well to spring, and there is no better way to leave a great first impression than by using it to boost curb appeal. Your front entrance will be the focal point of your home when buyers view the house, so it should look fresh, clean, and welcoming. Adding hanging baskets to a front porch overhang, as with the Superbells here, can help bring the eye up if you have architectural details to highlight. Or line the way up a front walk with some Salvia in happy colors.
Work with your Realtor or a staging consultant to bring in color and on-trend items when you’re preparing your home for market. Because while you’re not going to win album of the year (Kacey Musgraves already has that locked up), you can use the color of the year to your advantage when presenting your home for sale.
When is the best time to put my home on the market? It’s a question we Realtors get from clients all the time. Now, thanks to recent data gathered and evaluated by Realtor.com, we can give a definitive answer for the Portland metro area: The week of April 14.
Why? Buyers have started looking and they’re eager to buy before the summer market heats up, but in early April, most sellers aren’t on the market yet. It’s a classic example of the law of supply and demand. In fact, there are 23.9% fewer listings on the market that week than on average throughout the year. Only the Seattle and Denver areas had larger inventory swings than Portland. And anecdotally it makes sense, as many buyers want to enjoy summer in their new homes rather than move during our short-but-beautiful summer window. As a result, sellers are able to list their homes 5.5% higher than at the slow start of the year.
You may have seen the recent article in the New York Times that examines this further. They point out that in most major markets nationwide, April is ideal for sellers. Portland is no exception. Because of the aforementioned demand, sellers who list in our area in mid-April enjoy 24% more views of their homes online and 23% fewer days on the market than the market average.
Spring of 2019 promises more of the same. Interest rates are currently below 5% (30-year fixed) and inventory of mid-level single-family homes remains below demand. Factor in the giddy exhilaration Pacific Northwesterners feel when the spring sun finally gives them a good dose of vitamin D, and you’ve got excited April and May buyers.
We at Inhabit also understand that there are a lot of factors, often out of your control, that can affect the timing of putting a home on the market. Family and work demands, completing long overdue projects around the house, or even waiting for a neighbor down the street to sell before you put your sign up can all come into play. If that’s the case, talk with us. We know the market and can help you with great service and market knowledge at any time of the year.
If you’ve spent any time driving in Portland, you’ve seen it; that ubiquitous bumper sticker saying Keep Portland Weird.
It’s a slogan originally promoted by the owner of Music Millennium to promote the support of small business, but was quickly embraced by the city’s residents as a motto to live by. What is it that makes Portland so unique and… well, weird? Many think it’s the creativity of those who live here, and you can find it expressed in our hobbies and events happening all year long.
Want to experience Portland’s weird vibe? Here are 10 of the strangest events we could find around town. Everyone knows about the Rose Festival, beer fests, and Voodoo Doughnut, but add these to your 2019 calendar and you’ll know what makes our town so Portlandesque.
10 Minute Play Festival – Coming up quickly, March 7th through 10th, Clinton Street Theater hosts a plethora of plays at the 10-minute play festival. As you might guess by the name, the 10MPF stages a series of short plays each night. It’s a great way for local playwrights to produce shows and audiences to enjoy works from local artists. More info here.
B-Movie Bingo – The Hollywood Theater is a beautifully restored movie venue which hosts both culturally significant and culturally insignificant events throughout the year. It’s worth a visit to their website to check out their calendar. Or, you could plan regular visits on the first Tuesday evening of every month to play B-Movie Bingo, where bad movie clichés can earn you prizes and talk during the show is expected. The March 2019 show is a screening of 1994’s Guardian Angel, which easily slots this in the culturally insignificant (but fun!) category. More info here.
Rose City Rollers (RCR) – If you’ve never watched roller derby, you’re missing one of the most entertaining sports around. Strong, competitive women battle to victory – sometimes backward – on skates. The RCR All-Stars are good, too, having brought home the World Flat Track Derby Association (WFTDA) Championship in 2018. They skate at Oaks Park, and the season runs from March through June. More info here.
Crafty Wonderland – This is the event that puts Portland-makers on display. You’ll find specialty food, clothing, handcrafted jewelry, and even upcycled doll heads. Their main event is in December, but the smaller spring market is happening May 4th at the Convention Center. Stock up on unusual birthday gifts here. More info here.
Filmed by Bike – We don’t mean to put too much focus on Hollywood Theater, but I did say they host some great events. One not to miss is the 17th annual Filmed by Bike festival. The event draws filmmakers from far and wide, and is an opportunity to see some unique cinematography that gives a new meaning to “rolling.” Festivities run May 17-19. More info here.
Muppet Movie Singalong Bike Ride – The Muppet Movie, arguably the best kids’ movie of all time, was released 40 years ago on June 22nd. What did those adorable characters love nearly as much as chasing their Hollywood dreams? Singing and riding bikes. You can make like Kermit and ride your Schwinn starting at Irving park while the songs from the movie play along. More info here.
Weird Homes Tour – This one is right up our alley. We’re all about homes, and Portland is all about weird, so why not join the two? On June 29th, 8-10 unusual Portland homes will be on tour to ticket holders, and home addresses will be released just before the self-guided event. More info here.
Portlandia Mermaid Parade – Who doesn’t like mermaids? I mean, as long as they aren’t the traditional kind that lures sailors to their deaths. These are the ones that sparkle and shine on parade along the Portland Waterfront. Dress up and join the fun or be a spectator and watch the red hair flow on Saturday, July 27th. More info here.
Adult Soap Box Derby – If your boy scout pinewood derby car came to life, you’d race it here. Grown adults build gravity-powered racers and send them down the swooping turns on Mt. Tabor. Builders either go for speed or creativity, but rarely both. The races, plus the lovely setting with views of downtown and food carts providing refreshments, make this a favorite summer tradition. August 17th at Mt. Tabor Park. More info here.
Vaux Swifts at Chapman School – This phenomenon is not organized by humans, but is still a marvel of organization and coordination. Every September, a colony of Vaux Swifts has nested in the chimney of Chapman school in NW Portland. About an hour before sunset every evening, the birds gather, swoop and swirl in captivating patterns before diving into the chimney for the night. Bring a picnic dinner and sit on the school grounds for the display.
Of course, these are just a few of the hundreds of events around town. If you’re thinking of moving here and want to learn more, contact me and I’ll be happy to help you find the events, neighborhood and house that makes you feel at home in wonderful Portland.
Buying a home is like planting a tree; the best time to do it was ten years ago, the second best is right now.*
While I think this adage is true, there’s no sense beating yourself up for not buying ten years ago. Maybe you weren’t sure you wanted to set down roots, or maybe you always intended to save more for a down payment, or maybe you were still in high school. Regardless of the reasons, you’ve still got the second best option available to you.
Let’s talk about why it may be favorable for you to buy now.
Most urgently, it’s that your purchasing power at this moment may be better than you realize, and better than it will be next year. Interest rates are lower than they’ve been in months, currently around 4.5% for a 30 year conventional loan. They’re expected to rise as 2019 continues and the Fed raises interest rates, which have an effect on mortgage interest. Adding to the urgency is the fact that most people’s income doesn’t grow 5% per year – the average increase in the Portland metro area in 2018 – so every year you wait to buy will effectively reduce your purchase power.
As with many first-time buyers, your primary concern may be having enough down payment. The reality is that most of us don’t have 20% of the purchase price handy. But many don’t know that a plethora of lenders have first time buyer programs that don’t require much down, and it’s not just FHA loans that have this low cash-up-front requirement. Many companies have incentive programs that include low down payment amounts or closing cost credits. Talk with your Realtor who can give you a recommendation for lenders that specialize in catering to first time buyers.
In addition, owning a home can help you build wealth… if you’re in it for the long term. In the Portland area, even during the anomaly of the market crash in 2007, average home prices increased significantly in any given 10 year period. 2007 was the worst of the downturn in Portland. In September of that year our area’s median sales price dropped 6.7%, the largest single month reduction of the crisis. That year, median home prices were $290,000, but they were still far better than 1997’s median sales price of $150,000. Just like with the stock market, long term vision reduces the impact of volatility. It’s also another good reason not to wait to buy.
We’ve been talking long term, but you don’t have to wait a decade for financial advantages. Given that you can still deduct your mortgage interest from your taxes (up to a mortgage amount of $750,000) but you can’t deduct your rent, this gives you a yearly incentive to stop saving, start buying, and put that tax refund right back into savings. Building that nest egg isn’t a thing your grandparents did, it’s happening all around you.
Finally, as previously documented on this blog, winter is a fantastic time to buy. It’s the slow season, so with fewer buyers and increased inventory, you’re less likely to compete with other potential buyers when you write an offer. You may even be able to get into a new home in as little as five or six weeks from the start of your search. That ownership will bring increased housing stability into your family’s life. It’s time to talk with a Realtor and a lender. 2019 is the year you make homeownership happen.
*This analogy isn’t originally mine, but I love it.
Did you know there’s a “buying season” in Portland? And did you know it can be better to avoid buying in that season?
Every year the greater Portland area sees a wave of activity in the spring. According to data gathered from the RMLS listing service, we see the highest price peaks and the lowest amount of inventory around March and April. Sure, we know that time of year feels like the best time to buy. It’s when we come out of winter hibernation and the sun begins to shine. Buyers find their motivation and sellers’ homes look best as spring blooms sprout. But there are drawbacks, primarily in competition among buyers, that can be avoided by buying when everyone else slows down for a long winter’s nap.
The most recent Market Action Report from RMLS shows inventory in September 2018 at its highest since January 2015. This is a big change from the several years in which we’ve had low inventory driving already high demand, and it means good things for buyers. Those who take advantage of this opportunity will find that sellers are still putting their homes on the market, interest rates are still reasonable, and buyers have more leverage than in the recent past.
Buyers who write offers in winter will have another advantage that spring and summer buyers don’t: rain. Seriously, rain. A variety of home maintenance issues in the Pacific Northwest arise because of our wet weather. Leaking roofs, puddling water in basements, moldy attics and more are caused or exacerbated by precipitation. But without actively wet conditions, particularly in an older home, it’s difficult to tell if that stain in the basement is a current issue or something from years ago. As a result, savvy purchasers will hope for the worst weather during their home inspections.
One thing to keep in mind when deciding how to time your move is that the market will change. It always does. The trend since the downturn from several years ago, is that activity, competition and pricing dip during winter and rise in the spring. So if you’re going to try and “time” the market any time soon, the time may be now.
If you want to learn more, give Amy Seaholt a call. She’s happy to put on rain boots and go find you a house.
I’m here to tell you it’s time. You’ve owned your home for a while. Years, in fact. In that time the real estate prices have been increasing and your equity has expanded. So now it’s time to move to a house that will fit your equally growing family; or shed that space that you don’t need any more.
If this description fits you then you may be in a perfect position to move to your next house using the equity from your current home. But how do you do that when your down payment funds are locked up in your home. And how do you know if it’s the right time to move?
Let’s answer the second question first. Home prices in the Portland metro area continue to be on the rise. The inventory squeeze in Portland and the predicted future influx of population makes the chances of a pricing downturn miniscule. What does this mean for you as an owner? It means that though the sales price of your current home will rise, the acquisition price of your next property will also rise. Add to that the creeping increase in interest rates, and my recommendation will, in 99% of clients, be to move now rather than wait. Hesitation won’t work to your advantage.
If you’ve decided to move, but need to use the equity from your current home to purchase your next, how on earth do you manage that? Should you start with selling your current home or buying your next before selling? Both have risks and rewards, and in this post I’ll quickly review both.
Many people choose to purchase their new home first. Some buyers with good credit and income – and a lot of equity – are able to buy a new home before selling. Using a home equity loan, as allowable by your lender, permits buyers to pull money from their current home and use it for a down payment for their next home. The advantages of this are obvious, as they allow buyers to look for a new home on their own timeframe, without the pressure of selling their home first. They also eliminate the need for financing contingencies beyond the standard appraisal which all lenders require.
This means that buyers are able to remain as competitive as possible in what continues to be a seller’s market. The risk is that buyers could end up with two mortgages for an extended period of time, or their current home may sell for less than expected, putting owners in a financially tight situation.
Buy/sell using a contingency
Another option is to write a clause into the sales contract making an offer contingent on the sale of a buyer’s current home. This conditional sale allows a buyer to make sure they can secure a new home before selling their current home, eliminating most of the financial risk. It also often possible to coordinate closings so that the buyer can move directly into their new home eliminating the need for moving twice or finding storage.
However, as long as it remains a seller’s market, the stars must align just right for this option to work. You and your Realtors must find a seller willing to entertain a contingent offer, and if a competing buyer makes an offer that is not contingent on the sale of their home it’s difficult for the contingent buyer to win out. It also puts pressure on the person with the contingent offer to locate and secure a new home in a short time-frame once they have an offer on their current home. And if you write an offer on a home before securing an offer on your current property, the offer remains “bumpable” – meaning that someone else may write an offer on the home and the seller may opt to choose it unless the contingency can be removed. It’s a complicated approach with various moving parts that need to be timed right (and probably deserves to be examined in more detail than it is here). The contingent offer option can work, but a buyer may have to be quite patient before landing an offer that works.
For most clients, this is the option I like best. Have you ever heard the phrase measure twice cut once? How about sell first move twice? I just made that up, but it’s what I often recommend. What?! Move twice?! Well, hear me out. Selling first removes the financial risk associated with carrying two loans. It allows a homeowner to know exactly what they’ll net with the sale of their home and therefore the amount of money they have to put down on the next. With the abundance of available moving and storage companies, people who sell first will often store their belongings and find a short term corporate or Airbnb rental while they search for a new home. Some people even have fun with it, exploring a new part of the city that they may not have spent time in before. This approach removes the pressure of finding a home in a limited amount of time, as might happen with a contingent sale or when someone has the financial pressure of carrying two loans. This, ultimately, is the biggest advantage. Clients who have gone this route invariably have said that the stress of moving twice was more than offset by knowing exactly how much they could afford and the ability to take the time to find the right new home – not settling for a “just ok” fit – without feeling under the clock.
If you want to explore these options, or tell me that it’s crazy to think you’ll sell first and move twice, give me a call or come in to talk and we’ll find the right approach to getting you into your new home.