DECEMBER 2022 PORTLAND MARKET UPDATE
I’m sure many of you have been reading news on the market on the internet lately. There’s a lot of clickbait out there and misinformed reporters, so click with caution. Long story short: things are still slow (as we always expect during the holiday months) and interest rates are still higher than we’d like, but we aren’t seeing anything close to resembling a crash. Most importantly, home prices still saw appreciation this year over last.
While the winter and spring carried the greatest price increases and price drops have become common, our average sales price has only slightly dipped. “But Fortune Magazine said prices have dropped 15% already and will drop as much as 25%?!?!?”, you say? I’m not sure where these folks are getting their data (one article I read used the highly inaccurate Zestimate data to prove their point), but it’s not in line with what we’re seeing here in Portland. Average sales price in the Portland metro area decreased by 1.1% over last month but increased 8.3% over the last 12 months. The biggest change is days on market—now averaging around 60 days. Some sellers are still taking the “this house will sell itself” approach instead of taking the steps to properly stage and market their property. In the spring, this typically resulted in lower offers. Today, it often results in significant price drops and extended days on market. Keep an eye out for the slackers if you want a deal!
Anecdotally, two of the three homes that I currently have in contract involved multiple offer scenarios. One was one of the most brutal back and forth bidding wars I’ve experienced in a while and went significantly over asking price. The other was a tight race with three offers, with ours being chosen over a higher bid (yes folks, having a scrappy agent that will go to bat for you still matters even in a down market!). The third came in at asking price with closing costs covered before negotiations called for a hefty price drop due to unforeseen repair needs. All of this is to say: this is not a crash.
Inflation is still out of control, but we’re finally seeing signs that it’s slowing down. This news led to a small decrease in interest rates (yay!) over the past few weeks, but we can reasonably expect another rate hike before things really start to mellow out. The big question is: when will rates start to decline? While nobody truly knows, it’s looking like we’re nearing the peak and might see some relief come spring. Stay tuned!
Keep in mind that there is still a LOT of demand for housing in the Portland area. Many buyers have taken a break from their search until either prices drop or interest rates come down. While it’s reasonable to expect a small dip in prices (as we typically expect over the winter, barring pandemic buying frenzies), they won’t be enough to satisfy the folks waiting for a crash. Once interest rates get back in the 5’s, I expect many buyers to come out of the woodwork and competition to increase. This current winter slump is likely going to be as good as it’s going to get for prices. Cash buyers—now is your time! For the buyers waiting in the wings or considering buying/selling in the future, I’d be happy to chat about your particular market segment and help you come up with a strategy that works for your individual needs and situation. Send me an email, give me a call, or shoot me a text!
As always, I’m here to help!
