Some Portland area brokers are experiencing fewer showings, longer sell times and residential properties under contract bouncing back onto the market despite an anemic level of homes for sale and average fixed mortgage rates at 2.86%. Has panic buying and zealous bidding finally reached a stopping point?
The third quarter “appears to be leveling out,” said Adriana Focke, principal broker and owner of Check Point Realty in Portland.
Month-to-month spikes in sale prices are diminishing. July’s median sale price in the Portland metro area rose $1,000 or 0.2%, from $521,000 in June to $522,000 last month, according to the latest Regional Multiple Listing Service (RMLS) report.
That is a significant decrease from May to June’s jump of $6,000 or 1.2%, and April to May, when the median sale price shot up $15,000, or 3%, according to the RMLS. The median sale price is the point in the middle in which half of the properties sell at a higher price and the other half at a lower price.
Focke explains the recent change in pace by pointing to one of her properties for sale: A 1905 two-story house with 2,693 square feet of living space and a fully permitted basement at 443 N.E. Thompson St.
The asking price: $829,950, which Focke valued based on recent sales of comparable properties in the 97212 zip code. “It is in a close-in location, in a desirable neighborhood, has great curb appeal and many upgrades,” she said.
The four-bedroom house on a 3,920-square-foot lot was placed on the market on Friday, Aug 6.
“I was expecting a busy weekend with back-to-back showings, but … the home is still available,” she said on Aug. 18, concluding, “It’s looking more like the pre-COVID market.”
Focke said other real estate agents are having similar experiences with their new listings, including those priced under $500,000. “I have seen several withdrawn listings in the last two weeks,” she said, adding that Altos Research reports that market action has dropped.
The real estate marketplace Redfin shows 30 Portland homes that have had recent price reductions, including a $100,000 discount, to $2.15 million, for a Northwest contemporary dwelling on 0.41 acres at 6796 S.W. Canyon Dr. The asking price of a triplex at 2524 S.W. Spring Garden St. near Multnomah Village was cut $25,000 to $574,900.
Interest rates for 30-year, fixed loans have held steady after plunging from 3.02% in late June to the 2.8% range.
Also in home shoppers’ favor: The number of houses and condos added to the market has increased slightly, but the level of properties for sale — measured at 0.9 months in July — remains near the lowest level reported in the 30-year history of the RMLS, which hit rock bottom at 0.7 months in May.
“Although the Portland market is still intense, buyers can find some relief because there aren’t as many offers to compete with compared to earlier this year,” stated J. Lennox Scott, chairman and CEO of John L. Scott Real Estate in his monthly report on sales of existing homes. “Additionally, the number of new listings is slightly higher than the number of homes going under contract.”
If sales continue at the same pace, 0.9 months of inventory of homes for sale as reported in July means it would take about four weeks to zero out all the available homes on the market.
A market is considered balanced between buyers and sellers when there is four to six months of inventory.
“We need at least three months of inventory for buyers and sellers to finally feel comfortable in our market,” said real estate broker Dustin Miller of Windermere Realty Trust in Lake Oswego. “Giving a buyer a chance to see 10 houses near their liking before making a decision is really good. This pandemic market requires buyers to lose sleep and pay much more over list price in order to win out on the home of their dreams.”
Despite some agents’ experience of a slow down, the average time Portland metro residential properties were for sale last month before receiving an acceptable offer dropped to 20 days.
Impacting the level of homes for sale are owners concerned they will not find a replacement property in this highly competitive market and the foreclosure moratorium, which has halted what is typically a steady supply of distressed properties for sale by deferring monthly mortgage payments. The reprieve has been extended until Dec. 31, 2021.
New listings: The 4,267 Portland metro area homes introduced to the market in July marked an 0.7% decrease from the 4,298 new listings in June, according to the latest RMLS report. Last month’s new listings, however, were 0.7% more than homes listed for sale in July 2020, when homeowners were highly reluctant to sell in the early months of the coronavirus pandemic.
The inventory of homes for sale ticked up slightly in July, from June’s 0.8 months and May’s 0.7 months. Since June 2020, the supply of homes to sell has idled around one month, according to the RMLS.
Inventory is calculated by dividing the active residential listings, which includes proposed and under construction homes, at the end of the month by the number of closed sales for that month.
Pending sales: In the Portland metro area, the 3,354 homes that received an accepted offer in July was a 5.1% decrease compared to June and a 8.3% drop from July 2020, according to the report.
Closed sales: In July, 3,439 residential properties in the Portland metro area were sold — a decrease of 1.1% from the 3,477 that closed in June but a 1.4 % jump from the 3,391 closings in July 2020, the report shows.
Closed sales for 2021 have been as high or higher each month than in the last four years, according to the RMLS report.
— Janet Eastman | 503-294-4072
More on the Portland and Oregon real estate market:
• These hot Portland homes sold for way over the asking price: One owner pockets $605,000 more than expected
• What’s the benefit of pricing a home at less than fair value? Bidding wars. The tale of twin townhouses
• ‘Really Tan Portland Ken’ puts glass mansion up for sale at $9,495,000