Market Conditions in 97214>Question Details

Squeezed, Other/Just Looking in Portland, OR

Portland real estate prices have dropped 9% from their June 2007 peak. Is now a good time to buy?

Asked by Squeezed, Portland, OR Fri May 30, 2008

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If you plan on selling again in three months I'd wait. If you are going to live your life in this home for a few years or longer then now is a great time to buy. A home is not an investment. But all things considered the interest rates are good and the competition is down on desirable properties because lending criteria is steep. If you can qualify buy and be happy.
4 votes Thank Flag Link Fri May 30, 2008
Jed Lane; Fog…, Real Estate Pro in San Francisco, CA
MVP'08
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If you are flipping, perhaps not - unless you get a killer deal! But if you are looking for a home you'll live in for at least 3-5 years, and you qualify, I think it's a great time to buy. Inventory is great, interest rates are low, and a good Realtor who listens to what you want and need can work for you. Take a look around - even under $200k there is a lot to choose from now!

Have fun on your search!

Deb
Web Reference: http://www.welcometopdx.com
2 votes Thank Flag Link Fri May 30, 2008
The best time to buy is when you know you're making an investment in something that is the best deal compared with the competition. If you are looking at property that someone is trying to get out of because they bought at the top of the market in the last year, then slow down- its the wrong move. You might want to consider a property that has been in the owner's possession for quite some time. Then look at the price; have your agent do a thorough market analysis to determine what a fair price would be based on recent sales. Then have your agent negotiate negotiate negotiate on your behalf.
Real example: home was owned for over 30 years by one owner; he died, kids want their inheritance; house needs some work...I bring buyer, negotiate for seller to pay 9900 in cc&pp's and to provide Home Warranty, then inspection shows issues...I negotiate for seller to cover enough to make home "safe" by HVAC and Electric standards, sellers want out so after hem, haw, negotiate...they ok to get it sold. The buyer will come out with a home they got for a below market price, a great warranty which allows for pre-existing conditions, all cc & pp paid and enough left in that to cover to buy down a rate to 5.25% fixed for 30. There is instant equity and as soon as they plunk in another 10K the appraisal will be increased by 30K or so. A deal is out there for you; patience and an realtor who will work for you is the key. This deal took some time because I wouldn't settle for the usual negotiations. Knowing how to take advantage of the opportunities that are out there and applying some unique "now" negotiation strategies will help you find just the right investment. Contact me via my web site if you would like help in your search. Best to you!
Web Reference: http://www.junelizotte.com
2 votes Thank Flag Link Fri May 30, 2008
I'd wait until we hit at least a 20-30% decline in prices before buying.
2 votes Thank Flag Link Fri May 30, 2008
Hi Squeezed---

There’s an oft-quoted saying: “There are lies, there are d*** lies and then there are statistics.” (For some background on that quote, check out this link: http://www.york.ac.uk/depts/maths/histstat/lies.htm )

The 9% decline figure is elusive to me. However, whatever the figure and source, home prices in the Portland area, according to the highly regarded S&P/Case-Schiller Report, showed a 4.7% decline April-to-April: http://www2.standardandpoors.com/spf/pdf/index/CSHomePrice_R…

But, here’s the rub: that report covers a 7-county metropolitan statistical area. Using those statistics alone to make a real estate decision would be like planning a winter hike on Mt Hood based on the 7-county average temperature for that day.

Tom Inglesby quoted some good RMLS figures in a previous post that show a stronger market than the Case/Schiller report. He also made some good points on the strength of the close-in market and the cost effect of rising interest rates.

However, your question is more about market timing and the future. And predicting the short-term future in real estate is as difficult as predicting Portland’s weather.

Short answer: it’s always the right time to buy the right house. But…what’s the right house?

In my opinion, if you want to increase downside protection, buy quality of location. This means buying a home in an area where inventory levels are low and values have held up. Within those areas, look for homes in a price range where inventory levels are also low. Some areas of close-in Eastside Portland match these criteria pretty well.

A good agent’s help is invaluable, especially in this market. They know the strong pocket markets in the area. And they should be able to provide you with market date similar to this: http://www.trendgraphix.com:80/ORE/charts/721272137214721572… (If you’re into market statistics, check out this page on my website: http://edburnham.mywindermere.com/index.cfm?fuseAction=conte… )


Most important, your agent’s familiarity with the area will help you sort the wheat from the chaff in the listings. They will also provide you the data on comparable homes and the market knowledge you need to determine a good offering price.

Finally, the best general advice I ever got: Take the long-term view. Don’t try to time the market. If the deal seems too good to be true, it is.

Get a good mortgage lender, a good agent and get started!

Happy home hunting!

ED

Ed Burnham, Real Estate Broker
Windermere/Cronin & Caplin Realty Group, Inc
825 NE Multnomah Street, Suite 120
Portland, OR 97232
(O) 503/284-7755
(VM/Direct) 503/497-5209
(Cell) 503/314-3555
(Fax) 503/220-1498
Visit my website: http://www.edburnhamhomes.com
1 vote Thank Flag Link Mon Jun 30, 2008
Depends: What are your plans with the home you purchase? If you plan to Flip it - the answer is NOPE! If you plan to make the house your home or buy and hold it for an extended period of time- the answer is - YES!
Web Reference: http://forsalebyforsey.com
1 vote Thank Flag Link Wed Jun 4, 2008
This is a great time.

We are dropping some. Some areas more than others. But for buyers that can commit and are ready to buy you will find willing sellers. I would expect that you will be able to get anywhere from 2-8% off a price but make sure the comps are right on a home.

The big story is the rates. They are going up. A 1% rate increase will mean that you pay $100,000 more for the same home over the term of the loan. So I say be a buyer if you are ready.

Ne constructions starts are way off and there is a sell off in that sector. Once those deals are gone...in a year max...than prices for re-sale start to rise again.

So if you are needing a home do not wait. Be active. Look for late Summer and early Fall here to be the best time to buy.

I am always here to help.

I sold in the last downturn and I am having no trouble selling now.

Thanks;

Dirk Knudsen
Re\Max Hall of Fame
#1 Rated Re\Max Agent in Oregon
503-799-8383
Web Reference: http://www.nwhomecenter.com
1 vote Thank Flag Link Sat May 31, 2008
Hey Squeezed.

I think now is a good time to make offers. If you find a property that you want to own, you are able to get it for the price you want, and you and the property are approved for the loan then yes it is a good time to buy.

Best of Luck,

Brian Ramsay
Principal Broker
Realty Trust Group Inc.

http://www.OregonStyle.com
Web Reference: http://www.OregonStyle.com
1 vote Thank Flag Link Fri May 30, 2008
The market action published by RMLS that came out 6/12,/2008 which give the statistics for a year or year review says that May 2007 to May 2008 average closed sales price was down 4% while the median price was off only 3.2% which the average sales price 2008 rose 3.1% over April 2008 to May. Certain areas or pockets are still very strong. Close in eastside or westside homes are sometimes seeing multiple offers. The only place that seems to be dropping the most is east county Damascus, Happy Valley with some values dropping more that 15-25% in the past 2 years because of all the new construction. The first time buyers are driving the entry level market since rates are 1% lower today than last July and that helps your buying power by $20,000 if you are in the $200,000 price range. Forget about the price and focus on the interest rate. Time magazine February 25th 2008 in article written by Dan Kadlec, titled "Ignor the Headline",. Buying a $218,900 with 20% down at 5.5% payments are $994.31 if you want to wait for the market to hit bottom and try to guess when that is and if home values drop -10% more and rates go up to 6% then your payments will be the same at $994.94. So in most parts of Portland values are not going down that much or they might be going up and we will have to see what happens to the interest rates, but if you read about rates most economists say that rates will be going up to help the devalued dollar. I would not wait because of the inventory of over 17,000 homes and condos on the market there is a great inventory to look at and there are some great deals out there. I would love to talk to you and show you some houses.. Give me a call.

Tom Inglesby, Broker
ABR, CRS, RECS, CLHMS
RE/MAX Equity Group Inc.
503-495-5416
0 votes Thank Flag Link Mon Jul 14, 2008
Are you trying to bait people? ;)

A month ago I would have said wait, but given where interest rates are going I would say if you can find a deal go for it.

I've seen a number of houses selling for up to 20% below what they sold for 2 years ago. I think that's pricing in a correction pretty well.
0 votes Thank Flag Link Fri Jul 11, 2008
There are a number of factors, that would suggest a softer landing for Portland.
1. Significantly less sub-prime loans and subsequent foreclosures than CA, NV, AZ
2. Continued stability and appreciation in Portland sub-markets such as inner SE/NE
3. Continued public funding for urban renewal areas
4. Urban Growth Boundary - which has curbed development/inventory
As a result, it appears unlikely that Portland will experience the kinds of price drops we have seen in other markets. In other words, prices may continue to drop, but presumably we're not going to see them bottoming out at 20% (vs. peak) - as is the case in Riverside, CA or Las Vegas.
So, buying in the next 3-6 months may mean that you're not buying at the lowest point, but it would allow you to benefit from the circumstances only a market correction offers i.e. desperate sellers, lots of inventory to choose from etc. If you would like to find out more about this approach check out my blog (see below) which tracks properties that have been on the market for more than 100 days and/or where sellers have reduced their asking price by at least 7%.
Web Reference: http://www.agent503.com
0 votes Thank Flag Link Wed Jul 9, 2008
Buying while the inventory is strong is always in the buyer's favor as it gives you the advantage. Buying with knowledge is also always in the buyers favor. Buying based on National News Reports in not in the buyer's favor because the national stats don't apply to certain individual ever-active markets which have now opened up; those previously more challenging efforts toward homeownership have changed- yes; the market has flattened-allowing buyers to get some fantastic deals. Rates being lower and prices being more reasonsble means buyer's are finally able to gain the position they want to establish home-ownership in the Portland Metro area. Those looking for a long-term investment are smart to enter the market now. The investors who are buying short sales will also do well with adequate planning if they go about it right. (However, Sellers should beware of those offering a quick out from would-be 'helpers' who say they'll get them out of their debt. There are a lot of scams which take advantage of the sellers facing foreclosure. There are new regulations related to dealing with short sales. A buyer would do well to read up on it. Go to http://www.osbar.org to read all the new legislation. (that little helpful hint is free of charge! :)

The strategy varies for buyers based upon the type and cost of property, your investment goals and the length of planned ownership. Get an agent who will help you think through all of this... and not just try to get you to buy regardless of your goals. Feel free to count on me for that type of help. My clients can count on me to be their realtor for life. That means I'm not just in it for the quick closing. Your dreams, goals and investment risks are top priority. I want you to be happy by encouraging well thought out plans and informed decisions. Give me a call or email jlizotte@prunw.com to establish contact. Feel free to check out my web site. And Best To You!
Web Reference: http://www.junelizotte.com
0 votes Thank Flag Link Wed Jul 9, 2008
Yes, prices have dropped in Portland. But interest rates are on the rise so even though you may get a house for a lower price if you wait another six months, you will likely be paying a higher interest rate which will leave you with the same monthly mortgage payment you would have if you bought today at current rates. Indications are that interest rates could reach 7.5% by the end of 2008. No one has that crystal ball to really know, but NOW is a great time to buy -- prices are lower and rates are still GREAT!
0 votes Thank Flag Link Tue Jul 8, 2008
Dear Squeezed,,,

Stats are Stats and they can be used however you want. I could find you stats that say that we are down 30% in the Pearl and up 12% in inner SE. Tell me what you want. I can make the stats happen.

To answer your question..... Yes. Buy between now and the end of the year. If you need a home get one. If you don't buy and the rates go up 1% than you are paying another $100,000 for the home.

There are some smoking deals rigth now....

I'd go and get one.

Best wishes;

Dirk Knudsen
Re\Max Hall of Fame
Web Reference: http://www.nwhomcenter.com
0 votes Thank Flag Link Mon Jun 30, 2008
I think there are times to buy in any market. Not to say it is always a good time to buy, but there are always deals to be found. I personally don't think 9% of the peak is a great deal. I would be looking for properties that you could get 10-20% below market value. Yes, that means writing numerous offers and long waiting periods with banks. But patience and hard work pays off.
0 votes Thank Flag Link Fri May 30, 2008
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