All real estate is local, and this monthly report is a resource for those buying or selling on the Portland metro’s west side. The data below is for the areas including but not limited to NW Portland, SW Portland, Beaverton, Bethany, Hillsboro, Tigard, and Lake Oswego, and includes all residential resale transactions (new construction not included).
The point behind raising interest rates was to lower the demand for houses, thus lowering prices, thus lowering inflation. The demand side has indeed been notably impacted in the past few months. However, the prices- which through September are down about 6% from their peak in May, but holding relatively steady- don’t fully reflect the diminished demand all of us Realtors are seeing. Why is that? One big reason is the other half of the Econ 101 equation: supply. It’s been dropping too.
Looking at the chart, you’ll see that there were exactly two months this year that new resale (I’m not counting new construction, that’s for another day) listings on the market exceeded the average of the past four years: February (by a hair) and June. Every other month has lagged behind, and it isn’t like the supply side of the past four years was so hot to begin with. This makes perfect sense when you think about it. The “step up” market- those that want to move but don’t need to- is impacted by higher interest rates too.
So, tightening demand and tightening supply leave us more or less where we’ve been for the last couple of months.
The median list and sale prices were unchanged from August to September, both right at about $600,000. As mentioned, that median sale price is down from May’s peak of $640,000, but is still a full 10% higher than it was last September.
The red line is the supply side in a nutshell, and the number of new listings in September was 14% lower than it was last September. Sales and pending sales are also down, which mitigates the impact of lower supply. Even though less houses are being listed, the ones that are listed stay on the market longer…
…illustrated thusly. The average days on market is now up to 33, while the median is at 19. That’s nearly triple what it was last September.
Meanwhile, price transparency continues to improve.
We’re now at a point in which 32% of homes that sell do so over their list price, which is considerably lower than it’s been in a long while. 23% sold at list (and note that I’m measuring what the list price was when it found a buyer, not what the original list price was), while 46% sold under. So, about half of all homes sold below their list price. Something to keep in mind for sellers when setting a price, and certainly for buyers when making offers.
Being that supply is still impacted, the test right now is to see how much prices can drop simply due to decreased buyer demand. So far the answer is: not much. At least not here in Portland. Fewer houses may list, fewer houses may sell and it will take longer to sell them, but we’re not seeing a situation in which the bottom has fallen out. Just a return to sanity.
I am a licensed real estate broker in the state of Oregon with ELEETE Real Estate. Data is sourced from RMLS, and all analysis is mine and mine alone. If I can be of assistance in your home search or sale, please contact me at eli.cotham@eleetere.com or via the contact page.
