The return of condominiums?

If you've been paying attention, you'll have noticed the majority of those big residential construction projects of late, have all been apartment buildings, adding to Portland's rental inventory.  Expensive rental inventory, but rental inventory none the less.

Nextportland.com  is reporting a new condominium project has been proposed for the Pearl; the first condominium project to be proposed in about three years.   The proposed project, Block 20, is a 21 story tower with 149 residential units, parking for 192 cars and 224 bicycles.  It would take up a full block that previously housed the Hoyt Street rail yards, between NW 11th and 12th Avenues and NW Pettygrove and Quimby.

In a December 2015 article, Luke Hammill, of the Oregonian wrote about the notably small increase in owner occupied housing when comparing the rental housing versus owner occupied from 2005 - 2009 and 2010 to 2014.  Rental housing units increased by 14% where ownership housing increased by only 1%.

Is this project an aberration?  Or might we see new condominium projects outside the Pearl, and appearing in Portland's popular east side neighborhoods?  I know I have out of state buyer clients, primarily retiring baby boomers, who would LOVE spacious one-level condominiums on the close-in east side.

Shoot me an email or give me a ring if you have questions about Portland real estate.  leslievjones@gmail.com  503-312-8038.

What's next Portland?

Lots of news and chatter and scuttlebutt these days about tear downs, and stopping the demolition and developers and the like.  And yes, there are a lot of tear downs and demolitions and developments.

If you've not yet found it, nextportland is a website, facebook page and blog devoted to reporting on architecture and development in Portland.  They've got a great interactive map on their website with which one can get information about projects in various stages.

Sorry I'm not fancy enough to embed the interactive map here.  But click the link above and it'll take you there.  The different icons denote projects in permit review, early assistance, completed projects, announced projects, those in design and land use review, and inactive projects.

I hope you find this information helpful and interesting.  Let me know if you have any questions!

The Most Recent Market Stats are out!

RMLS just released the most recent stats about the Portland area real estate market.  As we've been feeling in our office, things are easing a bit.  Thank goodness!

Our market has been plagued by low inventory, with not enough houses on the market to meet demand.  As often is the case, this demand has been helping to drive prices up.  Not that a ton of houses have flooded the market, but inventory in April increased from 1.3 months to 1.4 months. When the May numbers come out, I predict we'll see a further increase in inventory.

We have clearly been in a seller's market.  A  balanced market, where neither buyers nor sellers are seen as having more power or advantage, is thought to be five or six months of inventory.

Speaking of those prices...Our year to date median sales price is now at $329,000, up 13.4% from the year to date median price in 2015 of $290,000.

The other indicator I like to watch is the total market time in our area.  The total market time for houses that went under contract in April was 43 days.  This compares to 61 days from April 2015.  Market times in North, Northeast and Southeast Portland for April 2016 were 25, 29 and 29 days respectively. Isolated to the neighborhoods inside Interstate 205, I'm sure we'd see even shorter market times.

It would be great to see a bit more easing, whereby we'd see more buyers getting their offers accepted.

Read the full Portland area report.

Get in touch with me if you have questions about the Portland real estate market, or want to talk about buying or selling. leslievjones@gmail.com  503-312-8038

Development costs and affordable housing?

It seems general sentiments in Portland are that residential real estate developers are a part of the affordable housing problem.  That is, the large expensive houses and small expensive apartments being built around town are driving home prices and rents up, beyond what low and median income buyers and renters can pay.

Nationally though, there is talk that the costs and delays associated with getting a piece of land to a build-able state are an oft cited reason for the increasing costs of housing.  That is to say, if development costs and processes are easier and cheaper, housing would be cheaper.  A Business Insider article by Bob Bryan addresses this.

A recent study from the University of Pennsylvania placed each state on a spectrum called the Wharton Residential Land Use regulatory Index (whew, say that five times fast).   States with less restrictive housing market regulations had lower WRLURI values.  As one might imagine, states seen as more environmentally aware and concerned had higher WRLURI values than states seemingly more sympathetic to business interests.  Check out the map at the bottom of the above linked article.  Oregon is classified as having above average land development restrictions.  I'm guessing the City of Portland would be classified in the "most restrictive" category.

Do you think that follows locally, in Portland?  Do you equate policies that are pro-developer with lower housing costs?

2015 stats from our multiple listing service

RMLS released the December and 2015 year end stats this past week.  For anyone working in real estate, selling, or trying to buy a house, none of this will be startling news.

Housing in the Portland area is in short supply; both for rentals and home ownership.  The number of houses available for purchase, at our current rate of sales, fell in December to 1.2 months.  This is the lowest inventory since we began keeping track in 1999.

At the same time, our average sale price (Portland area wide) rose 6.5% in the 2015 calendar year, from $333,000 to $354,500.  The average sale price in North Portland rose 14.8% .  Northeast and Southeast Portland average sales prices rose 8.3% and 9,0% respectively.

The number of days a house stayed on the market fell from 70 in 2014 to 54 in 2015.  In high demand neighborhoods, we are seeing houses sell in just a few days.  While the average days on market in some west side neighborhoods; Lake Oswego/ West Linn and Tigard/Wilsonville are at 81 and 70 days respectively.

Activity on the financial markets indicate possible increases in interest rates.  But for the time being interest rates are staying enticingly low.

This morning I'm off to show a house to some first time buyer clients. They have written countless offers, well over asking price, to the top of their price range. I continue to be amazed at the enthusiasm and fortitude of buyers in these market conditions.  I sure wish we could bring more houses to the market.

And for the record, an amount of this real estate activity is spurred by folks moving in from out of state. In my practice, those people have been mindful people, moving here to be near family.   Indeed, development is making its mark on our neighborhoods.  Keep in mind, most often, folks selling to developers and investors have been long time residents who are benefiting from the money. Some of my seller clients have used such funds to pay for a kid's college education or to retire from public service.

Please give me a call if you have a house you've been considering selling; rental, family house no longer in use?   Someone out there really wants it.  Thinking of buying?  Buying could actually be easier than renting.  Give me a call.  Considering a remodel project and want some input?  Give me a call.

Read the RMLS Portland Area Report

Leslie Jones 503-312-8038
leslievjones@gmail.com

That year end real estate report

Well, boy were my projections for 2015 off.  Last year I said, “For 2015 I predict an amount of the same, but with a few more houses on the market.  So, slightly increasing values (I’d love something like 5%), slightly increasing interest rates (to 5%?), and slightly increasing inventory.  I think we’ll see a larger variety of loan products as lending eases a bit.”

Instead,   We saw the average sale prices increase as much as 13.5% in North Portland, and 8.3% and 7.7% in Southeast and Northeast respectively.  Our inventory shrunk to less than two month’s worth, for most of the year. Interest rates remained low, and sometimes dipped even lower.  We saw more multiple offer situations and prices driven quite high by emotional, “gotta have it” buyers.  We did see a larger variety of loan products available, giving buyers more choice.

But the big story this year is with regard to our rental market.  Often, pre-crash, an active ownership market (people buying and selling to owner occupy) meant a soft rental market.  Instead of renting, folks are buying.  This year, we have had both, with a vengeance.  The rental market is so tight, rents have escalated sky high, and the prices on multiple unit properties have increased accordingly. Long time landlords are selling off their rentals and getting good prices.  Many out of town investors, attracted to our rising rents and tight market, are jumping in.

Wholesale evictions and exponential rent increases led the City of Portland to declare a housing state of emergency.  Through this, required notice times for no cause evictions and rent increases over 5% were extended to ninety days.  This is a small piece, slowing rapid fire eviction and rent increases to give beleaguered tenants a chance to catch their breath.

The CFPB Consumer Financial Protection Bureau issued new rules that took effect on October 3^rd, furthering borrower protections with regard to loan costs and fees.  These rules, commonly called “Know Before You Owe” assure borrowers ample notice and disclosure when the terms of their loan changes beyond certain thresholds. This is a good thing.

As for my 2016 prediction:     

Seriously though. We’ll see more of the same; tight inventory, with not enough houses to satisfy demand, slightly rising interest rates if the FED makes their move and slightly longer close times to accommodate the new CFPB regulations.

We’re seeing some rumblings and action being taken by county tax collectors in efforts to include in the tax rolls, “omitted property”.  That is, improvements that have been made to a property, but not included in their assessed value, such that taxes aren’t being collected on the improvement.  For instance, you remodeled your kitchen and baths, and finished your basement into a family room.  But your tax assessment is on the house, without those improvements.

When assessors find omitted property, they notify the owner and add the property to tax rolls. The law allows them to assess the property in previous years as well: up to five years in Oregon.  Oh joy.  

Some of you took me up on my offer of radon test kits.  I hope you all got low results.  I do have a few more kits available should anyone else want to test.

I remain honored to help folks with some of the biggest decisions in their lives, and humbled by the trust that is put in me.  My business is based on referrals.  I will always take good care of anyone you send my way.  Be it selling or buying, or just curious, I’m always glad to answer questions and provide information.

Energy, money and the sun

Great news!   We finally have a definitive study showing the market value of solar photo-voltaic installations in Portland!  Lawrence Berkeley National Laboratory conducted a study in conjunction with appraisers to establish the value of  PV installations in these market areas:  San Diego Metro area; Gulf Coast of Florida;Raleigh metro area (NC), Portland and Bend metro areas (OR) and the southeast portion of Pennsylvania.

From the study, the average premium paid for a house with a photo-voltaic solar installation was $10,600,   Interestingly, houses with solar were seen as taking longer to sell, and it was noted that " the market might be inflating prices based on green cachet, which would occur when additional value is placed on green energy items that are scarce in the market".  This study was looking at sales from 2011 - 2013.  I'd guess if they looked at sales in 2014 and 2015, we'd see a higher premium and quicker sales.

We've long struggled with valuing houses with solar installations, and appraisers were hesitant and or unwilling to assign any value to solar installations in the absence of good data.  Now we know.

read more about the study here