What our local housing market is doing and what it means for you.
Our housing market is changing. Everyone wants to know if home values will decrease, and the constant doomsday headlines are doing nothing to ease people’s concerns. You need to remember to keep the right perspective. Those headlines focus on national numbers, but you are affected by your local housing market. I want to show you what’s happening in the Portland Metro area to give you the proper perspective.
We’ve already seen some decrease in home values. However, appreciation is up by around 35% to 44% since 2020. This is local! Southwest Oregon down to Willamette Valley has experienced a lot of appreciation, so the market is still strong.
To understand if home values will drop, we have to look at supply and demand. Fewer homes are hitting the market this year, and those that do are sitting on the market significantly longer. Year over year, 4% fewer homes were listed, and inventory went from 14 days’ worth to almost 70. Prices adjust to meet the level of supply, so they will slowly decrease if the supply remains high.
Another factor to consider is interest rates. Over the month of August, we’ve seen rates increase at the start, fall in the middle, and rise again toward the end. Also, the buyer pool shrunk because of the fluctuation. This will affect the volume of home sales. Fannie Mae predicted a 16.2% drop in home sales this year from last year. Those numbers will most likely continue to fall as we head into the fourth quarter.
If you are thinking about selling your house, don’t wait until next spring. Pricing doesn’t bounce back that quickly, but don’t worry about losing money if you sell now! Your area is up at least 30% in appreciation since the pandemic hit. Historically, it would have taken us around 10 years to reach those numbers, and we did it in two. It’s all about perspective.
If you have any questions, you are welcome to call or email me. I’m here to help.