This year’s real estate market has seen a continuation of the gradual slowing and balancing of the appreciation of home prices. Catching many Sellers (and their Realtors) off guard when prices did not “shoot up” in the Spring as in past years. Many of the inner Portland neighborhoods, will see a near 0% appreciation this year. However, some areas are still appreciating. The suburbs and those areas that typically lag behind the inner Portland neighborhoods saw gains. Overall, looking at the Median Sales Price in the greater Portland Metro area, as defined and measured by RMLS, 2019 will see about a 2.1% increase.
I chose the Median Price because it takes out many of the anomalies that factor in when using Average Sales Price. Remember math class? Half the homes sold last year are above the median, and half are below the median. It’s just looking at the total number of units sold, not what those units sold for. Compared to past years, we saw the median jump 12.6% in 2016, 9.4% in 2017, 5.2% in 2018, and 2.1% (est) in 2019. This is a trend towards a normal balanced market. The total inventory has likewise flatted out this year and stayed pretty close to 2.4 months of inventory. That statistic is widely quoted in the press and other newsletters. But what does it really mean to us? I believe it reflects a more accurate reporting of the real estate market when combined with appreciation.
For those who bought a few years back, your equity position is looking really good. The median price of a home in the Portland Metro area is going to end the year at about $410,000. In 2007 – the pre-recession peak year, it ended the year at $285,500. We are now over 40% above the previous peak prices. If you bought during the recession, you might be closer to a 50-60% increase in value.
When we talk about these hefty price increases in real estate, there are always thoughts of affordability, housing crisis, and homelessness. It’s the time of year when we should all think about those less fortunate. Reach out a helping hand, donate to a charity that is making a difference, or volunteer to serve others. We give a portion of each commission check we receive to Transitional Youth, an organization that was started by the person who founded our company, Berkshire Hathaway HomeServices Northwest Real Estate. Bert Waugh has given so much back over the years and we do what we can to support this great organization that helps youth get off the street and into stable housing. TY provides job training, and life skills training so these young people have a platform to sustain a stable life. I’ll never forget, many years ago, when I went to a secure area at the Port of Portland to meet a client. The young man working as a security guard at the guard shack saw my business card and asked me if I knew Bert Waugh. ‘Yes,’ I said. He then went on to tell me that Transitional Youth helped him get off the street and into a home. He was now working and supporting himself with a great job. If you would like to give or get involved, please let us know and we’ll get you in touch with this great organization.