Interactive maps make me happy which makes this a happy post.  MetroTrends has a nifty interactive map that show migration to and from the 100 largest metro areas.  Relocation to Portland remains strong; over the last ten years Portland has seen a migration inflow.  Seattle is our largest trading partner and we’ve actually exported more residents than we’ve gained from our neighbors to the north.  Californians seem to like it here (I’m one of them) and I think we can understand the allure of Phoenix weather.

Click image to launch interactive map

From the interactive map there is a drop-down box on the upper right side that give more mapping options, including housing prices and rental affordability.

The short term migration forecast for Oregon remain a net positive but the Office of Economic Analysis says:

Slowdown in Oregon’s economy in the recent years resulted in smaller net migration and slow population growth. Estimated population growth and net migration rates in 2011 are the lowest in over two decades. This slow population growth, as a result of slow economy and high unemployment rate, is expected to continue in the near future.

Longer term forecasts show that Oregon will add over 1.4 million people between 2015 and 2040.

It was less than three minutes after an earthquake hit the San Francisco Bay Area this morning that the first posts started to appear on my Facebook page.  You can’t avoid the horrifying images of the tornadoes that swept through the Midwest and South a few days ago.  Floods, earthquakes, forest fires, and other natural disasters make up a significant amount of our headlines, just not locally.   Yet.

On one of those brilliant “five mountain view days” we have to remember that we’re looking at a bunch of volcanoes.   A number of years ago I got an email asking about volcanoes and earthquakes.  I wrote a brief reply and the response was a long diatribe about how all of us in the Northwest are on the brink certain destruction by volcanic activity and if those didn’t get us the earthquakes will.  Not exactly a comforting thought but not impossible.  Mt. Saint Helens reminds us once in a while that its an active volcano.  The Oregonian has a good write up on the potential for Pacific Northwest earthquakes.   Someone once told me that, “an extinct volcano is extinct until it is not.”

With each natural disaster, the news coverage eventually makes mention of insurance.  The event was or wasn’t covered.  What happens when “The Big One” hits?  Most pundits say it isn’t a case of “if” but “when?”  Will you be covered?  I can’t say what insurance coverage you should have but you want to know if your covered even though the whole goal is to never have to use it.  Earthquake coverage is often an add-on to a policy. Would an act of God be covered under your policy?  What about a landslide?

Flood insurance is one type of coverage that is often mandated by lenders.  If you are in a flood plain, it’s likely flood insurance will be required.  You can do your initial search for potential hazards on PortlandMaps.  Enter the property address and click on the “hazards” link on the “maps” tab.  There’s flood, slide, earthquake and fire information on that tab.

I think most of us take our insurance policies for granted.  An audit of your policy might reveal that you’re under-insured, not covered or even paying for coverage you don’t need.  And if you’re reading this as a renter: please take a minute to make sure you have a renter’s policy.  The odds are your possessions aren’t covered under the landlord’s policy.

Is it cheaper to own or rent a home?  I did a Craigslist search for a close in home with the complete property address listed so I could then research what I thought it would sell for as a comparison.  I happened to find a home that sold for $150,000 at the end of last year.  I can tell from the pictures in RMLS and the ones posted on Craigslist that some work has been done.  I think I am being generous with adding $10,000 for a theoretical market prince of $160,000.

After adding in the property taxes and an educated amount for home insurance we get a payment of $1013.86 per month.  The house is listed for $1250.  The downturn in the real estate market has made owning a home more affordable than it has been in years.  If you put down the FHA 3.5% down for a loan of $155,440 your payment would drop to $992 plus any required mortgage insurance.  With 20% (investors may be required to put 25%) the payment is only $861 per month.

We need to acknowledge that this is massively simplified.  Not everyone will qualify for a 4.0% loan, we haven’t addressed down payments, maintenance costs, tax advantages, market risks or anything else.  It  shows us one reason that investors are retuning to the market and the investment properties should cash-flow positive which they didn’t do at the peak of the market: appreciation was the carrot (and therefore not a sound investment strategy looking back). It shows how competitive the rental market has become and that may give some potential buyers reason to further investigate their own situation to see if which scenario works best for them.

CNN/Money reported today that median home prices have reached a ten year low.  They graphed the decline since 2007 on a national basis.  We’ve taken their national numbers (sourced from the National Association of Realtors) and added RMLS data for “Portland Metro” and ten of the RMLS areas reported in RMLS Market Action.  The median price is the point at which half of homes are sold for a higher price, and half are sold at a lower price.  The prices reported are for January of each year.  Click on the graph to see the full size version.

Between 2011 and 2012, the NW Portland area (roughly west of NW Skyline and between HWY 26 an HWY 30), was the only area reporting a median price increase.

The article also has a video of how Habitat for Humanity in Florida is turning foreclosures into opportunities for their clients as part of the national Neighborhood Stabilization Program.  It’s a departure from their typical model of building new construction homes.

Once upon a time,  before my time in real estate, a potential buyer had almost no idea what a house was going to look like before they got out of the car in the driveway.  Real estate was ruled by an MLS book that closely resembled a phone book.  There were no pictures, floor plans, Google Street Views or videos available.  We don’t have many clients say, “keep driving,” anymore.  When we pull up to a house now, the buyer is often verifying what they already know because they’ve already “seen” the house online.  The richer the listing, the fewer showings that should be required to sell it.

I took this picture a couple of weeks ago while stuck in traffic.  I cropped the “For Sale” sign out from the right hand side.  The photograph will self select a large portion of the potential buyer pool out.  No need to visit if you’re looking for a move-in ready home.  But it is “pending” in RMLS now so there is a buyer for every property (at the right price).

Another component to the number of showings relates to the notice needed to view it.  Sometimes the answer to, “why isn’t my home getting shown?” is, “Because buyers can’t get into to see it.”  The less restrictive the showing instructions the more likely the property will be shown.

• “Vacant- RMLS lockbox“  No need to call unless I’m is looking for more detailed information.  We won’t discuss how a house that is colder inside than it is outside shows poorly here.
• “Call first” “Hi, this is Charles Turner with Atlantic & Pacific Real Estate.”  I’d like to show your home between noon and 1PM.  If that’s going to be a problem please call me…”  This is the best scenario for an agent when setting up appointments for occupied homes.
• “Appointment Required” Actual contact needs to be made to show.  If you’re not good at returning calls this is a terrible option to get your home sold.  I’ve left messages and gotten calls back days after our showing request.
• “Agent Accompany” I need to coordinate with the listing agent to show your home because they need to be there.  Scheduling conflicts may eliminate the showing.  Agent accompany showings requires all four parties to the transaction coordinate.
• “Tenant Occupied” Some sellers and their tenants come to some sort of an agreement where “call first” is sufficient notice but this is the exception, not the rule.  Most require 24 hours notice.  This eliminates potential showings when a pre-planning is not an option.

There are some situations that can’t be avoided.  A day sleeper has to sleep when the majority of us are working.  We try to respect kid’s nap times.  Pets and security systems can also make showings difficult.  Our advice is to make the showing instructions as simple as possible while covering the needs.  Adding restrictions because it is inconvenient will reduce showings.  Selling a home is inconvenient but remaining on the market is even worse.  We use “Call listing agent” as necessary.  It works well when English isn’t the seller’s native language but is more often than not totally useless with a vacant home just so the agent can “monitor showings.”  That’s what the electronic RMLS lockbox is for.  It notifies the agent when the box is opened and if the agent is using a home feedback system the seller is also notified.   To reiterate, most of these situations can be worked out and the house will get shown but in some instances showings don’t happen to qualified buyers because of them.

RMLS released the latest edition of Market Action yesterday.  The Portland Metro market report shows that inventory bumped up from a month ago.  Closed sales are up but the number of new listings is down.  The 8514 active listings are the fewest in three years.  With more buyers competing for fewer listings we’ve heard some lament that they are not finding what they are looking for because there are too few houses to select from.

Average sales price is $249,100 which is about the same as it was this time last year and at the beginning of 2005.  The question for 2012 is whether prices will follow the same trend as 2011 where there were gains in the first part of the year lost in the second half or do something completely different?  Lower prices and the lowest interest rates in years have pushed Portland’s Affordability Index to the highest level since reporting began in September 2003.

Here are links to all of January’s Market Action Reports.

All Areas (68 pages)- Baker County- Columbia Basin- Coos County- Curry County- Douglas County- Grant County- Lane County – Mid-Columbia – North Coastal Counties- Polk & Marion Counties – Portland Metro- SW Washington- Union County- Wallowa County

Graphs from RMLS.

“Good schools” is often one of our client’s top criteria.  As Realtors, the problem we face that it is largely a subjective decision and subject to change. It is similar to the “safe neighborhood” conversation: you can tell us what neighborhoods you want to search based on them but we can’t tell you where you should live based on them.  Both require buyer research so our goal is to provide the resources to make good decisions.

Useful links include:

• Oregon Department of Education Report Cards
• Clackamas County School Locator (includes Lake Oswego)
• Portland Public Schools Locator
• Beaverton School District attendance information
• Tigard-Tualatin School Infomation
• Hillsboro School Information

Additionally, Portland Monthly publishes their Best Schools report annually.  From their homepage you’ll find the link under the real estate heading.

Six continual months of (minimal) Portland real estate price appreciation has slipped away in the last two month.  The Case Shiller Index, released this morning shows Portland lost 2.18 points to end November at 133.26, essentially the same level as February of last year.

The Case Shiller Index reports “Portland Metro” as the seven county MSA and lags sixty days.  RMLS reports a five county “Portland Metro” and the mid-month report features the previous month.  In January 2000 the Index was reset to 100.  Portland peaked at 186.51 in August 2007.  In contrast, the Composite 20 Index peaked at 206.52 in July 2006.  Both indices were almost identical in July 2010 at 148 and now the Composite 20 is five points ahead of Portland.

Portland was “late to the party” during much of the run-up and the beginning of the decline but appears to have fallen into the same groove as the national indices.

Here’s four real estate related stories in the media this week. The first is yours truly on OPB’s Think Out Loud discussing the same year end Portland real estate market data cited in the second Portland Business Journal article. The third article from the USA Today is more of a national story but interesting nonetheless. The fourth, on Oregon’s unemployment rate (bad but getting better) is a key factor to any housing recovery.

Is the Housing Market Coming Back?

Is the Portland housing market beginning to turn around?

Analysts are taking up that question with the release of a new report from the Regional Multiple Listing Service. The bad news is that the organization’s data show the median house price in the Portland metro area fell another 7.9 percent to $221,000. Home sales totaled $5.2 billion in 2011 — an 11-year-low.

Home sales end 2011 mixed

Year-end sales figures paint a mixed portrait of Portland’s residential real estate market for 2011. Overall sales rose compared to the prior year but other metrics, including price, fell.

Bartiromo: JPMorgan’s Jamie Dimon sees housing at bottom

Scroll down to question on U.S. housing Market:

We have seen the worst. We are at the bottom. We may hug along the bottom for a while, but we are at the bottom. People think housing is terrible, but the early indicators tell you a lot about where it will be in 18 months or so. Supply and demand are rapidly coming in balance. Renting is now more expensive than buying in half of America. We’re adding 3 million Americans a year. In the next 10 years, we have 30 million more Americans. Those 30 million Americans are going to need 15 million homes, or something like that. Household formation has gone so low. You had kids move back home — and, yes, by the way, it doesn’t work for them, either.

Oregon unemployment 8.9%

Portland Business Journal

Oregon’s unemployment rate has dropped to its lowest level in three years.

It’s not a real estate article but jobs are a key factor in the housing market.
I’m not loving the orange background on the quotes, will work on getting that toned down!

I’m just heading down to the OPB studio for this morning’s Speak Out Loud segment at 9:00 AM.  Here are the links to the December 2011 RMLS Market Action reports:

• - All Areas (68 pages)
• - Baker County
• - Columbia Basin
• - Coos County
• - Curry County
• - Douglas County
• - Grant County
• - Lane County
• - Mid-Columbia
• - North Coastal Counties
• - Polk & Marion Counties
• - Portland Metro
• - SW Washington
• - Union County
• - Wallowa County

This Willamette Valley Multiple Listing Service’s year end report.

Here’s the link to my comparison of the average sales price of the local Portland areas for 2010 and 2011.

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