Archive for September, 2007
At least those that are still employed. This new candy bar, featuring ‘Zero carbs. Zero fat. Zero interest in any subprime loans.’ showed up at my office meeting this week:
Courtesy of Naida Paris and Stuart Brown of Valley Mortgage in Newberg, Oregon. Highly recommended mortgage consultants and a steady voice of reason and calm amidst the tempest.
Design by Angeleen Umfleet of Riveting Design & Advertising. Used by permission.
Technorati Tags: credit, crunch, mortgage, financing, homes, houses, candy, parody
If you're new here, you may want to subscribe to my RSS feed. Thanks for visiting!
September 28th, 2007
As I’ve noted over the past couple years (here, here, and here for example), Portland gets its share of plaudits from national writers and reviewers for land use, housing prices, and other livability factors.
Lately though, Portland’s suburbs have been getting some pub.
Recently, Money magagzine rated Sherwood as the #18 in their Top 100 most desirable places to live in the country.
About Sherwood, Money reporters said:
Like much of the Northwest, Sherwood is home to an array of beautiful parks and natural beauty. But the quickly growing commercial sites of Sherwood offer true insight into the town’s character: a juxtaposition of old and new, with reverence toward both the city’s historic past and its bright, expanding future. The community events calendar is always full and the town’s location makes for a fairly easy commute to nearby Portland
Lake Oswego, perhaps Portland’s toniest suburb, gets a mention at #32.
One of the major attractions of this Portland suburb is the 405-acre artificial lake whose banks it sits on. Waterfront properties are highly sought, and many residents take advantage of the lake, either by boating on the weekends or hanging out at one of the parks on its shores. Another big appeal is shopping and dining. Lake Oswego is full of many one-of-a-kind boutiques and unique restaurants. And for arts lovers, the Lakewood Center offers top-notch instruction at its dance studio along with fantastic shows put on by its theater company.
(By the way, the word ‘artificial’ conjures up images of sterile concrete, which is far from reality.)
And today, U.S News and World Report claims Hillsboro as one of the top 10 locales in the U.S. to retire.
About Hillsboro, the U.S. News editors said:
….folks are passionate about preventing urban sprawl and safeguarding its unique mix of suburban convenience and natural beauty. The preservation of agricultural lands (like vineyards) has been a hot topic, and the city promotes its Orenco Station housing development, a concept designed to build community but also discourage the carcentric (and environmentally unfriendly) lifestyle.
A retiree, however, should not live on drink, golf, and public policy alone. Hillsboro offers the usual cultural suspects: farmers’ markets, arts center, library, theaters, and the like, yet for those needing a romp through the urban jungle, its access to the light rail system makes for an easy trip into the heart of Portland. And an hour’s drive west takes you straight to the Oregon coast.
To be honest, I had never thought of Hillsboro as a retirement Mecca, but then again, I spent 15 years of my life preparing for (eventual) retirement by working in Hillsboro’s burgeoning technology cubicle farms. Golf and wine tasting were not high on the daily work agenda.
Perhaps in contrast to most major metropolitan areas, Portland’s suburbs are typically within 30 minutes of downtown PDX, yet have their own identity, events, arts scene, Farmer’s markets, and more. Not a bad way to go if you’re not urban-oriented, but like the proximity to the Big City for occasional outings.
Technorati Tags: Portland, Sherwood, Hillsboro, Oregon, towns, city, rankings, retirement, retire, livability, Money Magazine, U.S. News and World Report, relocation, homes, houses
September 26th, 2007
This Sunday, The Oregonian published a timely article by Julie Tripp entitled, To buy or to rent?.
Over the past few years, the answer to the rent vs. buy question has unequivocally been BUY. Easy financing, scorching year-over-year appreciation, and a high in-migration rate has meant that most home buyers could bail out or turn their property quickly–often at a profit after just one year.
But the recent sluggish market calls that strategy into question, even in the healthier-than-the-national-average Portland area.
Call me conservative, but even at the peak of the housing boom in Portland, I cautioned buyers that their minimum window of occupancy needed to be at least two years. Capital gains tax could chew into their proceeds, and secondly, the closing costs associated with both the original purchase and the impending sale would devour much of the equity appreciation.
Now, the discussion tends to be more about waiting for deeper price reductions in the market (so as not to catch the falling knife, as one reader put it) or simply renting to avoid all the uncertainty. So, is it better to rent and invest (assuming you’re disciplined!) the down payment plus the monthly difference in payment in say, the stock market?
The New York Times has an elegant calculator that you can use to evaluate the rent vs. buy decision for yourself.
The calculator starts with some basic defaults (monthly rent, % down payment, property taxes, etc.) that you can update as you see fit. Additional factors can be tweaked with the Advanced Settings links. Sliders control the amount of sales appreciation and/or rent increases. For some perspective, Portland’s housing market has appreciated around 8 percent annually since 1973. (You can contact me with questions about other variables specific to Oregon.)
In the Oregonian’s real world example, the break-even was 2.7 years in purely financial terms, which sounds about right to me (in most cases).
In most cases, the decision isn’t purely financially-driven. But the numbers can help ‘justify’ the intangible factors of pride of ownership and creating a sense of community and permanence.
Technorati Tags: Portland, Oregon, rent, rentals, homes, appreciation, investment, purchase, calculator, Oregonian
September 24th, 2007
Across the Portland metro area, average and median prices for over the past 12 months were up 7.8% and 8.1% respectively over the previous 12-month period. Appreciation has been showing a gradual decline as inventory grows and prices soften. Results are still among the best in the nation, however.
Southeast Portland climbs above Gresham in average price, and now threatens to overtake Beaverton / Aloha to become the eighth-most expensive market area. Northeast and North Portland also show above-average gains month over month and have some of the shortest time on market statistics. The remainder of market areas remained virtually flat year-to-date with August’s sales report.
Below are average and median sale prices year-to-date, along with 12-month sale price appreciation by market area:
| Lake Oswego / West Linn |
$559,200 |
$465,000 |
6.3% |
| West Portland |
$463,300 |
$379,000 |
3.4% |
| NW Washington County |
$418,800 |
$385,000 |
2.0% |
| Tigard / Tualatin / Sherwood / Wilsonville |
$379,600 |
$340,500 |
4.4% |
| Milwaukie / Clackamas |
$339,100 |
$301,000 |
4.3% |
| Oregon City / Canby |
$327,900 |
$304,000 |
6.7% |
| Northeast Portland |
$322,300 |
$283,000 |
6.9% |
| Hillsboro / Forest Grove |
$298,100 |
$270,000 |
9.8% |
| Beaverton / Aloha |
$290,700 |
$262,500 |
3.6% |
| Southeast Portland |
$289,100 |
$251,700 |
10.8% |
| Gresham / Troutdale |
$281,700 |
$260,000 |
11.2% |
| Yamhill County* |
inc. |
inc. |
inc. |
| North Portland |
$266,200 |
$253,100 |
8.6% |
| Columbia County |
$254,000 |
$239,900 |
14.9% |
*Yamhill County results are incomplete. Updates will be posted when available.
Appreciation percentages are based on a comparison of average price from the last 12 months (09/01/06 - 08/31/07) with 12 months before (09/01/05 - 08/31/06). Source: RMLS, September 2007.
Technorati Tags: Portland, Oregon, real estate, home, prices, housing, average, median, sale, appreciation
September 19th, 2007
Home sellers in the Portland metropolitan market will be stretching their patience muscles even more as 2007 winds down towards the typically slow 4th quarter.
August 2007 results show an increase in market time (days on market), now at an average of 56 days. By contrast, August 2006 rated 41 days, and August 2005 a mere 37 days. This market constipation has created the highest level of inventory since 2003. At the current rate of sales, if no new listings were added to the market, the active homes on market would take 6.2 months to clear. As of August 31, RMLS displayed nearly 16,000 homes for sale.
Although the 12-month rolling average shows an 8.1% increase in the median price, RMLS data also shows that the median house price in the metro area stayed flat from last month at $300,000. Average sale prices were $366,900. My review of prices showed virtually no movement in the year-to-date rollup from last month, but the North, Northeast, and Southeast Portland market areas did show some relatively strong price increases over the previous month. In the case of North and Northeast Portland, their time on market was substantially lower than average at 42 days.
The flattening of prices is a predictable result of increased inventory primarily due to fewer sales than in the previous year. While home sellers have been unwilling to cut prices, they will have no choice but to do so or take their property off the market in hopes for a better spring. This pricing pressure will show most in the homogeneous suburban areas where time on the market are well over the average (Tigard, Hillsboro, Oregon City, Sherwood, Clackamas, etc).
Note, I have seen some evidence of 1st-day multiple offers on homes that were priced aggressively, so there are motivated buyers on the hunt. Low interest rates (and perhaps some help from the 1/2-point interest rate cut by the Fed today) will spur some additional activity before the fall ends.
Tomorrow, I will post year-to-date average and median prices along with 12-month appreciation figures broken down by market area.
Technorati Tags: Portland, Oregon, real estate, market, activity, statistics, prices, listings, sales, homes, houses, residential
Photo by Velma’s World, used under Creative Commons license.
September 18th, 2007
As one of the nation’s leading cities in conservation, Portland is also at the forefront of sustainable building practices, products and technologies. To accentuate that point, this Saturday, September 15, the city sponsors the sixth annual Build It Green! Tour of Homes and Information Fair.
From the Build It Green! site:
Now in its sixth year, the 2007 Build It Green! Tour of Homes features eighteen remodels and new homes, two high-rise residential condominiums and one cohousing development, showcasing a variety of ways homeowners are conserving energy and other natural resources while creating beautiful, unique and healthy homes.
An accompanying Information Fair, hosted by Environmental Building Supplies, is free and open to the public 4:30 – 7 p.m.
Homes of all kinds can be found on the tour: high-rise condos, period remodels, multi-family homes, eco-architecture (cob, straw, clay), ultra-modern rowhouses, infill projects and co-housing.
Details can be found at the city’s PortlandOnline.com website.
Technorati Tags: Portland, Oregon, homes, construction, development, conservation, green, building, sustainability, tour
September 14th, 2007
Recently, Portland’s multiple listing service, RMLS, announced an upgrade to their servers, allowing an additional 8 pictures to be uploaded for each active listing. Now, an agent can submit 16 images for each listing, at twice the earlier resolution allowed before.
So, that’s good news, right?
In theory, consumers get more views of each home and hopefully, better image quality. But this new flexibility should come with a warning:
Should we use all 16 images to market each listing?
I say it depends on the house. Some homes just won’t benefit from having additional images, due to size, disrepair, or owner’s unwillingness to clean up or de-clutter. For my money, the mandatory photos should capture the front of the home, the family and/or living room, the kitchen (from a couple angles), dining area, the master bedroom, plus the rear of the house and backyard. Beyond that, it would depend on other material or visual features of interest.
When the photo limit was 8, I always augmented my listings with photo tours like this one. Now, even with 16 available images, I expect to continue this practice because it allows for unlimited photos with larger formats and some marketing flexibility for me.
Many homes have features and visual interest that can easily take advantage of the extra allowance. Sizeable master baths, media rooms, garden sheds, territorial views, a shot of the neighborhood, or nice guest quarters can all be shown in the picture set now.
But what we should strive to avoid are toilet-dominated bathroom shots, overflowing laundry areas, garages bulging with flea market goods, enormous bedroom sets in postage-stamp bedrooms, and pictures of the front-drive with the Gremlin on cinder blocks. You think I’m kidding, but even when there were just 8 pictures, we’d see this sort of thing frequently.
Below are a couple examples I’m talking about. They are real photos found in other MLS sites:
and
Thankfully, these weren’t found in the Portland MLS. Thanks to Athol Kay of reagentinct.com, for use of his Bad MLS Photos of the Day. There’s lots more where that came from.
I challenge my local broker-brethren to stay off his list! Remember, quality over quantity.
Technorati Tags: Portland, Oregon, homes, RMLS, MLS, pictures, photos
September 13th, 2007
Lost in the wailing and gnashing of teeth in the national media over foreclosures, mortgage liquidity woes, and slow housing starts is the fact that mortgage rates are low, low, low and Portland’s listing inventories are high, high, high (not sky-high, though).
A recipe for a buyers’ perfect storm? A run on housing inventory? Wellllll, maybe not. But conditions are certainly upbeat in Portland despite mortgage meltdowns and the national real estate picture as a whole.
Buyers with a long-term outlook should be encouraged at the prospects of locking in at wicked-low rates (~6.0% as of today!) and having a wealth of properties to sift through. Sellers, on the other hand, still hearing of the metro area’s average appreciation holding at around 7 or 8 percent are making price reductions, but not in fire-sale mode.
Even if sellers aren’t falling over themselves to unload their property at any cost, the market is as robust as ever and as balanced as it has been in some time.
The most recent Portland State University Center for Real Estate quarterly report comments on the health of the local market:
To summarize, Portland defies the national trend with continued modest appreciation. Although appreciation is much slower then the double digits experienced last year, Portland remains healthy compared to the national housing market. While there were some warning signs during the first quarter of 2007, including increasing days on market and declining number of transactions, the area rebounded in the second quarter. The median price of existing homes increased, the number of transactions increased, and days on market fell—all indicating a recovery. But, how long will it last?
Local homeowners have been relatively shielded from defaults, too. In fact, Oregon is reported to have the nation’s 2nd lowest foreclosure rate (of 0.5 percent) in the 2nd quarter of 2007.
With the good news locally, I expect a bump in activity through the early fall, siphoning off some inventory and perhaps alleviating some fear brought on by national housing anxieties. If there is a segment of the market that will on the sidelines, it will be first-time buyers with less-than-adequate credit.
P.S. By the way, if you haven’t already, lock your mortgage rate today, according to the pros.
Technorati Tags: Portland, Oregon, homes, housing, mortgage, rates, buyers, PSU
Photo by woooooo, used under Creative Commons license.
September 7th, 2007
