Ultra-low inventory slows down Portland-area housing market
May 13, 2016 – Luke Hammill, Oregonian
For the first time in recent memory, the number of closed and pending home sales in the Portland area saw an annual decline, according to the April edition of the Regional Multiple Listing Service’s monthly report.
With the housing market on a tear, the report had become predictable from last summer into this spring – the number of closed and pending sales for a given month was either the most since before the recession, or the most of all time. But the 2,611 closed sales in April marked a 4.5 percent drop from the same month last year, and pending sales fell from 3,613 in 2015 to 3,076 this year.
“I think that’s partially or mostly because of our inventory being so low,” said Dustin Miller, a broker with Realty Trust Group. “People are just gobbling up stuff so quickly that homes are really flying off the market.”
Inventory indeed remained extremely low, ticking up slightly from 1.3 months in March to 1.4 in April. The figure estimates how long it would take for all current homes on the market to sell at the current pace. (Six months of inventory indicates a balanced market.)
And the trend of rising values also didn’t reverse, with the average sale price increasing to $397,700, up from $347,500 last year. The median reached $350,000 last month, the point at which half of homes are more and half are less; in April 2015, the median was barely above $300,000. Homes in desirable areas often receive double-digit numbers of offers.
“The buyer who did win the bid may have a Monday-morning headache crunching the numbers on how much they just paid,” said Israel Hill, a managing broker at John L. Scott Real Estate specializing in Northeast Portland, in an email.
Real estate broker Nick Krautter predicted inventory will not significantly rise until prices get so high that the temptation to sell will be too strong for homeowners to resist.
In the meantime, he said, “we’ll see prices continuing to increase.”
Hot areas in April included Southeast Portland (313 closed sales), the Tigard/Wilsonville area (250), Beaverton/Aloha (245) and West Portland (237).