Portland Real Estate Blog

I just removed last week’s poll and put up a new one. Last week’s results surprised me in that I expected readership to take a gloomier view than they did.

Yesterday, the Oregonian ran a story titled “What can I get $285,000 ?” by Connie Potter. Most of the data is from the latest RMLS market action”. She says:

The median price of a home in April was $285,000, up 5.75 percent over a year ago when the median price was $269,500, according to RMLS data. That means of all the homes sold in March, half sold for more than the median price and half sold for less. Year over year, the median sales price jumped 11.2 percent over the 12-month period ending in April 2007 compared with the same period ending April 2006.

We’ll have to revisit the poll results at the end of the year. In my opinion, if we can get to September with prices up over the previous 12 month period, we’ll see a positive overall 2007 as it was the end of last year where the market started to take a beating.

We’re going to try running polls on the right-hand side of the blog. I’m thinking that they’ll run for a week and I will update them on or around Monday then post the results for posterity.

Ideas for suggested polls (keeping to Portland Real Estate and keeping it clean)?

Next week: As a buyer, what is the first thing you notice when you enter a home?

Some stats from RMLS:

Area 143 (Southeast Portland). I use 143 because there is a wide range of properties in all price ranges.

Currently 770 active properties listed as vacant. 196 vacant properties sold in last 30 days. Ratio 25.4%

Currently 486 active properties listed as owner occupied. 129 sold last 30 days. Ratio 26.5%

Fifteen properties sold as tenant occupied; 92 currently listed. Ratio 16.4%

Of the 1348 active listings:
57% are vacant
36% are owner occupied
6% are tenant occupied

Of the sold in the last 30 days:
57% were vacant!!!
38% we owner occupied
4% were tenant occupied

What this tells me is that there is little difference between being vacant or owner occupied but tenant occupied houses don’t do well in the market place. There is a big difference between owner occupied cluttered and vacant staged, we just have no empirical evidence to prove it.

With access to information comes power. That is, if you know what to do with it. One of the most frequent questions we are asked about a property is, “how much did they pay for it?” It doesn’t matter. We have no idea what the history of the sale is. Was it bought as distressed property from an anxious seller? Did the buyer pay top dollar because there were competing offers and they just HAD to have that home (or had been beat out on two or three before getting and accepted offer?).

Even with a flip property, we can’t tell if a coat of paint was slapped on the property or if every system was replaced by a master craftsman (though good marketing should make that apparent). Again, we can’t tell what the circumstances of the purchase were.

The number of times we hear, “They don’t deserve to make that much” is laughable. The market determines what they make. Do we get upset at stock market investors who buy low and sell high???

Zillow, Trulia and Redfin are probably the national market leaders in providing the consumer with information. Portlandmaps is probably the best sources for Portland area Real Estate.

I need to find a copy of the 60 minutes report on real estate from over the weekend.

Build it and they will come? Probably not. Yesterday’s cover story of the business section of the Oregonian has a story about city planners looking at the idea of up to nine 20 story buildings surrounding a 37 acre park in Hillsboro. The artist rendering suggests NYC and Central Park. The most appropriate comment is probably the last paragraph of the story: developer John Bartell, VP of Opus Northwest, “If you would have asked me 20 years ago whether the Pearl could have made it this far, I would have said, ‘no way.’”

There have been plenty of comments about overbuilding in the Pearl and South Waterfront area. This has got to get you riled if you are currently sitting on the sidelines waiting for the bottom to fall out of the high rise condo market in Portland. I think you may have a long wait but Hillsboro?

The story acknowledges this project is in its infancy and by know ways a done deal.

RMLS reports days on market for each RMLS area monthly. Time on market in March, the latest data available from RMLS places DOM at 51 days for SE Portland (area 143). Average overall time on market was 65 days for that period. Average selling price in SE Portland was $293,500.

How does price range effect days on market? For April, I ran my own reports (using our company’s proprietary software). Total days on market was 43 days (a large drop from March’s 65). I ran additional searches and discovered the following:

Seventy seven properties sold under $200,000. They averaged 44 days on market
There were 192 sold properties priced between $200,000 – $400,000. Average time on market: 40 days.
Thirty five properties sold between $400,000 – $600,000. Average time on market: 48 days.
$600k – $800k: seven properties sold averaged 72 days on market (see a trend forming?).
Over $800k; three properties for 130, 137 and 157 or an average of 140 days!

There is most likely some difference between how RMLS gathers data and I searched for it. When their April report comes out (usually about the third week after the period is over), we will compare my overall results to theirs.

So what? It shows us that there is a much larger buyer pool at the “lower” end of the market and properties move faster. It says that sellers at the higher end of the spectrum need to have different expectations about selling their properties.