Existing home sales came in at a whopping 6,850,000, beating estimates with the highest print since 2006. Days on market fell from 36 days to 21 days on a year-over-year basis. Cash buyers remain at
Influx Of First Time Buyers To Play A Large Role In Portlands Housing Scene
Dated: February 22 2017
With all of this demand, is it reasonable to expect that we will see a large number of new homes built? Unfortunately no. New construction will occur, but it won’t represent a huge boost to the supply of inventory. Land and labor costs, paired with challenges associated with Portland’s Urban Growth Boundary, will continue to increase new construction costs, making many perspective projects unviable.
Housing affordability is remarkably important to a region’s success. We need Portland’s above-average price growth to slow down, but it’s simply not going to happen in the foreseeable future due to a lack of inventory. We can expect home prices to rise by approximately 4.5 percent in the greater Portland area in 2017, which is still above the long-term average.
The average rate for a 30-year mortgage will continue moving higher, likely landing around 4.6 percent by year-end. This isn’t necessarily a bad thing because it will function as a headwind to price growth. (A useful formula is that buying power decreases by about 10 percent for every one percent increase in the mortgage rates.)
To close, housing will continue to be at the forefront of the Portland economy in 2017. New policies by the Trump administration could go in any direction, either helping or hurting the economy, but at this juncture, it is impossible to forecast the effects of the new administration. Accordingly, any kind of political change brings a heightened level of uncertainty with it, inherently causing economic and housing market instability. That said, I still expect the Portland region to outperform national figures, both economically, as well as in the local housing market.
By Matthew Gardner at Bizjounals.com
For Mark Ross, founder of Ross NW Real Estate and professional real estate broker, real estate has always been the career of choice. During his 25+ years in the industry, Mark has gained experience in....
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