Forbes names Portland housing market as one of eight cities most likely to outperform in 2016


portland housing pricesForbes Magazine
recently released their predictions for the 2016 national housing market. They forecast which cities are most likely to outperform or underperform the rest of the country. The predictions are based primarily on job growth and housing affordability. Portland was named as one of the housing markets most likely to outperform the rest of the country.

While Portland housing prices seem high to many long term residents here, and to outsiders considering a move to the northwest, our home prices are still low relative to other major cities on the west coast, which is why some of those cities are on the most likely to under-perform even with strong jobs numbers.

According to Forbes, “the candidates that are among the top performers in regards to both rising home sales and home prices will generally be out West and in the South. Salt Lake City, Portland, and Riverside will likely experience a good year in the West.  Atlanta, Charlotte, and Tampa look solid for gains in the South. One Midwestern city will shine and that market is Grand Rapids. For the Northeast, Providence could surprise us.” With the exception of Providence, all these cities had more than 3% job growth during 2015 though Providence was not too far behind.

The under-performers forecast all experienced significant job losses, and historically, as job trends go, so goes the housing market.

Job growth driving huge migration of new residents to Portland

According to the Oregon Office of Economics, approximately 40,000 people are moving to Portland every year. These new migrants come from everywhere and include all ages and ethnic backgrounds. But the hugest number of migrants are in the 20-30 year age group and are well educated, even if many are unemployed. That may seem like an oxymoron, but for the educated, areas with high job growth are natural locales for seeking employment. And the young are generally more mobile than any other age group.

Oregon is in fact a state of migrants. 51% of all current residents are from a different state or country. Yes, it’s true that the majority of migrants are from California and New York, but all states are represented and 15% of the migrants are from outside the US.

So far it seems that all major housing analysts are predicting a very strong year for the Portland real estate market in 2016 as compared to the rest of the country.  

Want to know how your neighborhood ranks in terms of sales and pricing? Check out the links below to learn more about where homes are selling the fastest and at the highest prices. Close in neighborhoods dominate both lists, but there are many more suburban neighborhoods on these lists too.

Don’t blink: Here are Portland’s 25 fastest-selling neighborhoods in 2015

Portland’s 25 priciest neighborhoods of 2015

 

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Portland home sales for December 2015 blast through all prior records in pricing and number of sales


sold pendingThe Portland Oregon real estate market closed out December 2015 on fire. While home buyers typically take a break during the holidays, there was literally NO slowdown in the Portland housing market. Sold and Sale pending signs dominated the landscape throughout the metro area.

December 2015 sales were 21% higher than those for December 2014, and were the most sales ever recorded for December in the Portland metro area in the 24 years these records have been maintained.

Average home prices also rose in December to $367,000, up $36,000 from last year during the same month, and up $20,000 from just one month earlier in November 2015.

Portland home inventory drops to lows not seen since 1999

Due to the surge in buyers, real estate inventory dropped to 1.2 months (the number of months it would take to sell all houses on the market if there were no new listings). This is the lowest housing inventory Portland has seen since 1999.

According to RMLS statistics, 2015 beat out 2014 on all averages including number of pending sales, closed sales, new listings, sales and median prices.

Many realtors and lenders credit this surge of home buying activity to the anticipated rise in mortgage rates, which fortunately has not yet occurred. But we can’t lose sight of the fact that rents in this area are rising so fast, that for many, home ownership is actually cheaper than renting, and offer the advantage that monthly payments are locked in for the life of the loan (principal and interest).

Analysts predict drop in number of home buyers in 2016

For 2016, some analysts are predicting a slight drop in the number of home buyers as rising prices could price them out of the real estate market. But with rents rising as fast, if not faster than home prices; some of those renters could get more motivated to buy a house as quickly as possible; if for no other reason than to lock in their monthly housing payments.

In fact we are already seeing price increases on existing listings; and new construction is already pricing higher for homes under construction than buyers paid for identical homes during 2015.

Buying versus renting – tough call for many Portland area residents

Research and sales show that a large percentage of renters would like to be home owners. But with rents rising as fast, if not faster than home prices, it’s becoming increasingly difficult to save for a down payment. Many long time renters could get more motivated to buy a house as quickly as possible if for no other reason than to lock in their monthly housing cost.

For more information about what is driving the Portland metro real estate market, you might want to read:

Portland among top four housing markets in the US

Businesses moving to Portland citing affordability as #1 factor

Zillow rates Portland among top 10 housing markets for 2016

Portland rents among fastest rising in the country

 

 

 

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2015 wrap for Portland Oregon

2015 was quite the year for Portland Oregon. We ranked as one of the top cities in the country in many ways:

Portland ranks banner

  • PDX named best airport (Travel Pulse).
  • Portland among top four housing markets in the US (Redfin Realty).
  • Second best best city for foodies (Washington Post).
  • 4th highest ranked city “on the edge of greatness (Sperling best places.net).
  • 4th best city to retire to (Sperling best places).
  • 10th highest ranked city for being “green.”
  • Third “quirkiest city in the US (Travel & Lesiure).
  • Among the top ten in most pedestrian friendly cities(Travel & Leisure).
  • Top 5 in most improving housing markets (Freddie Mac).
  • Portland named among top 25 best cities to live in the world (Monacle Magazine).
  • Millenial generation chooses Portland (CBS News).
  • Portland farmers market named best in the country (Huffington Post).
  • Among the top food cart cities in the world.

As with any city that is growing faster than we can keep up, Portland also has its share of problems we have to tackle; so Portland also ranked high in some areas we’d prefer not to rank:

  • 8th worst city in traffic congestion
  • Almost at the bottom of the list in educational scoring
  • Almost at the top of the list in number of high school drop outs
  • Increasing crime rates and gang violence (182 gun violence deaths in 2015 with almost 40 of those related to gang violence)
  • Fastest rising rents in the country
  • 10th highest ranking city for online crime
  • And finally we’ve even caught President Obama’s attention for the very high number of homeless in our city. As more people move here, some without money or jobs, the number of tent cities continues to rise; as do folks with signs at every freeway on and off ramp.
  • Gentrification of inner city neighborhoods driving long term residents to the streets.

2016 is slated to be the year we tackle many of our biggest problems.

  • Steps are already being taken to deal with education deficiencies. While many of our schools are very highly ranked, others need some help. To solve these problems, Portland will no longer require students to take national tests as too much time is spent on preparation causing other areas of study to lapse behind. New school boundaries have been drawn to better balance the populations in different areas around the metro area. The new boundaries are scheduled to go into effect in 2016.
  • Rent control measures are being discussed and implemented to control excessive rent increases to tenants.
  • Portland police department is in recruiting mode offering signing bonuses to beef up our forces to combat crime and gang warfare.
  • The homeless problem has been acknowledged and local politicians and committees are looking for ways to better house and feed our residents.

The one thing we can say about this city is that deficiencies do not go unnoticed. Portland residents take pride in all that’s great about this city, and campaign actively and get involved to improve what needs fixing. One has to believe that this is among the top reasons that so many people want and do move here. We’re not perfect, but we’re always striving to be better. 

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Portland among top four housing markets in the U.S.

Move over Silicon Valley. The hottest tech sectors in the U.S. are now Boston, San Francisco, Seattle and Portland.

Portland skyline with Mt HoodAccording to a spokesperson at Redfin, “We’ve talked a lot this year about the great tech migration and how the influx of tech companies, tech workers and tech money is affecting the real estate market in places like Portland, Seattle, Denver and Boston. It should be no surprise that major tech hubs were home to some of the fiercest bidding wars this year, but even we were taken aback when we crunched the numbers to find the nation’s most competitive neighborhoods for home buyers in 2015.

The 30 most competitive neighborhoods of 2015 were all located in just four cities: Boston, Portland, San Francisco and Seattle. The rankings are based on several indicators of competition, including the percentage of homes that sold above asking price, how quickly homes went under contract and the percentage of Redfin offers that faced bidding wars.” In fact, the rankings on the charts below were compiled based on a lot of Redfin broker stats, so other reports could differ somewhat from this list.

As has been reported previously, Portland has been aggressively courting technology companies, and the tactic is working. Many of the high tech industry giants already have offices here, and new tech start-ups are locating here attracted by the relatively lower cost of living as well as other amenities that Portland offers.

As you can see from the chart below, according to Redfin, Portland’s hottest neighborhoods included Hawthorne, Belmont, Brentwood, and Woodstock. Check out the columns showing percentage paid above list price, price increases, and percentage of cash buyers! While most tech businesses report that they are looking for their talent first in the talent pool within Portland, they all too often find themselves being forced to recruit from around the world to find people with the right education, skills and experience to fill the positions.

This is in no way meant to imply that only the four neighborhoods named below were hot in 2015. All of the Portland metro area has been feeling the pressure in the housing market; due to new residents, home buying college graduates, and current residents who are looking to become first time home owners, or to move up or down within the markets.

New and expanding businesses are locating throughout the metro area, and of course, every buyer is looking for different features in their neighborhoods.

Home buying in the four cities mentioned Redfin’s report has definitely become challenging and the forecast is that this trend will continue well into 2016.

REdfin statsREdfin stats2

 

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Businesses moving to Portland citing affordability as #1 reason

businesses that have offices now in PortlandOne of the factors that had kept home prices low relative to Seattle and San Francisco, was our inability to attract big businesses to Portland. This has all changed recently. According to an article in Portland Business Journal, Portland is still affordable relative to other big business locales around the country. But, “Economic development agencies statewide have been using Portland’s affordability to aggressively recruit companies from high-dollar markets.” The strategy has succeeded in attracting “Google, SalesForce.com, Airbnb and eBay, who all now have Portland offices and collectively employ more than 1,000 workers. Additionally, startups like the targeted email provider Customer.io and rental management software maker Cozy have relocated their companies from New York and San Francisco, respectively, to take advantage of Portland’s lower costs and availablity of talent.” And of course, business giants like Nike, Columbia Sportswear, and Intel have been in Portland forever.

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