2018 has been an incredible year for Portland real estate. We are grateful for the opportunity to help you realize your real estate goals.
Have a Happy Thanksgiving.
Million-dollar homes are still rare in metro Portland, but their share of the market has more than tripled in five years, according to the real estate website Trulia.
About 1 in 40 homes hit that threshold in the Portland area in 2018, Trulia said, up from 1 in 125 in 2013.
And while nearly all major metros are seeing an increase in million-dollar homes as prices rise across the nation, the shift has been more dramatic in Portland.
In 2013, Portland ranked 42 out of the 100 largest metros in its share of homes valued over $1 million. In 2018, it had climbed to No. 28.
Home prices in the Portland area have climbed 47 percent since 2013, according to the S&P CoreLogic Case-Shiller index. The median home price topped $400,000 for the first time this year, according to the Regional Multiple Listing Service.
In the Bay Area, million-dollar homes have become the norm. The median San Francisco home value is $1.3 million, according to Trulia, and 81 percent of homes cost more than $1 million.
About 13 percent of Seattle-area homes are priced over $1 million. The median home price there is $565,000.
— Elliot Njus
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First-time home buyers who have long been thwarted from entering the real estate market by rising prices and interest rates may see a little relief in 2019, according to the National Association of Realtors’ annual buyer and seller profile. The survey covers from July 2017 to June 2018.
“Low inventory, rising interest rates, and student loan debt are all factors contributing to the suppression of first-time home buyers,” Lawrence Yun, chief economist for NAR, said in a statement. “However, existing-home sales data shows inventory has been rising slowly on a year-over-year basis in recent months, which may encourage more would-be buyers who were previously convinced they could not find a home to enter the market.”
But where are buyers going?
Younger buyers are heading into the suburbs, according to Jessica Lautz, NAR’s managing director of survey research and communication. “Many millennials are moving to the suburbs because it’s more affordable, especially in higher-priced markets,” Lautz said.
Rising student loan debt is a major factor keeping them out of the market. “Every year we’ve collected the data, the amount of debt has gone up,” Lautz said. In 2017, 34 percent of buyers were first-timers; this year that figure was 33 percent, according to the report.
Despite the mounting debt, millennials are the largest demographic of home buyers, she said. That number would be higher, she said, but the cost of construction materials and labor are rising, and strict zoning regulations make building housing especially difficult and expensive.
The report found that single female buyers were outpacing their male counterparts.
“For the second year in a row, single female buyers accounted for 18 percent of all buyers,” according to the report. “The group was the second most common household-buyer type behind married couples (63 percent). Single male buyers came in third and accounted for half the number of buyers as their female counterparts (9 percent). However, single males tended to purchase more expensive homes, with a median price of $215,000, compared with single females, at a median price of $189,000 (the lowest of all household buyer types).”
And buyers are putting down bigger down payments. The average buyer put down 13 percent, up from 10 percent last year. Lautz attributed the increase to the growing number of first-time home buyers who received financial help and the number of move-up buyers using equity in their homes.
The competition for those homes may also be a factor.
Historically low inventory is driving prices up, and reasonably priced homes are selling very quickly across the country, according to NAR. You might think that would drive more sellers to try to sell their homes without a real estate agent and pocket the savings, but the opposite is happening.
A record-low 7 percent of sellers sold their homes without a real estate agent last year. This number has been steadily declining since it peaked in 1981, when 15 percent of owners sold their homes themselves, according to the report.
“I think one of the things happening here is the lingering psychological after-effects of the recession,” Lautz said. “Prices have mostly rebounded, and sellers want to be sure they don’t leave money on the table. They know they don’t know how to price and market the home in today’s market. They don’t want to do it alone. They want a professional.”
Stop by Northwest Portland’s Bedford Brown for a glass of bubbles while shopping for unique ornaments, garlands, wreaths and gifts for everyone on your list.
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