During the time it took to leaf through our annual real estate guide in any of the past seven-ish years, your home could appreciate, oh, 15 percent.
We kid, we kid. But it’s not that much of an exaggeration: by the tail end of the 2010s, the breathless pace of appreciation in Portland home prices started to seem like the new normal.
In 2020, to borrow from the state’s tourism board, things look different here.
Not to sound all Chicken Little about it—the sky’s not falling, at least not yet. People are still moving to Portland, albeit at slower rates, and unemployment is low. Instead, the real estate wonks who spend their days immersed in the data (that could be you—start with our side-by-side neighborhood comps, p. 65) pick careful words like “stabilizing” or “correcting” or “leveling off.”
In 2019, homes in Portland sat on the market for just a little longer (an average of 40 days, up from 37 in 2018) and cost a modest 4 percent more than they did in 2018; suburbs saw similar trends. It’s not so sexy, but it is a whole lot more sane.
“We knew it was unsustainable,” says Carrie Richardson, co-owner of Home Team Realty in Southeast. “You can’t have 10 percent appreciation every year. Prices need to level, and appreciation may take a dip before going back up. In the meantime, if you put a good house on the market for the right price, it will sell quickly.”
And, if you’re a buyer, this means you might be in there with a fighting chance.
“Some of my clients would write eight, nine, 10 offer letters before one was accepted,” says Anette Sieverson, a senior mortgage adviser at Pacific Residential Mortgage in Lake Oswego. “That is not so much the case anymore.”
“Buyers will have more time to make a decision,” adds Morgan Davis, a broker at Keller Williams Realty Portland Central. “You won’t have to decide 10 minutes after you walk through the home. Now you will have a few days. You can sleep on it, bring a friend through.”
Don’t despair, though, if you’ve got a house to sell. The number of houses on the market remains among the lowest in the past 20 years, with an average of about 5,600, as some homeowners wait for the next great boom.
“My interpretation is that people don’t want to sell their current home today because there is nothing else for them to move into that they like or at the price they want,” says Josh Lehner, an economist in the Oregon Office of Economic Analysis. “The overall volume of transactions is relatively low. If we could somehow transition to higher levels of inventory [and] higher volumes of sales, then people would feel more comfortable trading around their housing situation.”
Meanwhile, thirsty would-be buyers are still on the prowl, buoyed by crazy-low interest rates (that are likely to stay that way, Lehner says, given signals from the Fed that it will take a massive boost in inflation for rates to rise).
“We went to one house near SE Woodward and César Chávez, a classic three-one Craftsman in a cute part of town,” says recent buyer Jes Rivas. “We got there 90 minutes into the open house, and the showing agent made it clear that we were the 55th couple to be there so far.” (Rivas and her wife wound up buying a new-build, attached home in the same neighborhood in late December.)
For ever-hopeful buyers, Davis suggests seeking out homes that have been sitting on the market for a few weeks or a month (since those do exist now, after being virtually nonexistent for years), even if they are above your price range, and making a lowball offer. Check out neighborhoods where prices actually decreased in 2019—like Sullivan’s Gulch in close-in Northeast or Goose Hollow downtown for homes in the $350K range, Woodstock in Southeast and Hollywood in Northeast for homes around $450K, or bucolic Bridlemile in Southwest for more than $600K.
And keep an open mind: you might wind up in a neighborhood you hadn’t planned on, but can grow to love—like Caitlin Bagwell (see p. 63), who happily traded a rental on NE 19th off bustling Alberta (“Someone threw a brick through our back door. He had two plums in his hand from our backyard tree, and he left them on our bed. I was like, ‘I don’t want to live here anymore.’”) for a home at the edge of Lents, though the original goal was to buy below 82nd Avenue.
The point is, the Portland market right now is perhaps more buyer-friendly than it has been in a decade—and that opens up a lot of front doors for first-timers like Aaron Cantu, who needed a home large enough for himself, a teenage cousin he’d taken in, and an ailing parent, for not more than $350,000. Cantu spent two years paying off debt, building up savings and improving his credit score before blitzing through 20 houses in two weeks last fall. His search ended at a four-bedroom on a dead-end road in the David Douglas School District, backing up to a dog park and with room to grow; his offer was accepted over just one other bidder.
“I don’t have a college education,” Cantu says. “I’ve been turning wrenches and working my whole life. I am a Chicano person. My mom’s house, growing up, we got evicted. They foreclosed on it. I don’t have any inherited wealth. This is my inherited wealth. I just created it.”