High demand fuels Portland’s rocketing housing prices: Median sale price jumps

Hope may be on the horizon for home shoppers: More residential properties are expected to be put up for sale in the coming months and spiking prices may level off slightly as some owners on the sidelines jump into a still-competitive Portland market, experts say.

But other factors like record-low home inventory and a wave of motivated first-time buyers will keep sellers in the power seat.

John L. Scott Real Estate agents were informed by company CEO J. Lennox Scott that the “frenzy-level” demand to buy a home remains in the Portland area.

Portland new listings

The number of new residential listings over the past three calendar years in the greater Portland, Oregon metropolitan area have changed, according to the RMLS.RMLS

Adding to the tension: The number of existing homes listed on the market in May dropped by 2.3% compared to April, according to the latest Regional Multiple Listing Service (RMLS) report.

The total number of new listings — 3,971 — in May was less than expected in a month starting on a Saturday and ending with a holiday weekend, Scott said.

But the listings signaled a 16.1% jump over May 2020, when owners were reluctant to hold open houses or move during the early months of the COVID-19 pandemic.

Sellers were active last month, accepting 9.3% more offers than in April. More deeds also changed hands in May: 8% more than in April and a ballistic 62.1% more than in May 2020, according to the RMLS.

The median sale price in the Portland metro area jumped $15,000, or 3%, from $500,000 in April to $515,000 in May, according to the RMLS.

Portland sale price

The average and median sale price for all homes sold in the Portland, Oregon metropolitan area has been steadily climbing, according to the RMLS.RMLS

Home shoppers’ preference for expanded living spaces, indoors and out, continues to cause well-priced homes in desirable areas to receive multiple offers.

For example: A midcentury modern house designed by architect Saul Zaik in the Southwest Hills sold for $164,000 over its $1.1 million asking price on May 14.

Trisha Highland, a broker with John L. Scott Woodstock, said economists aren’t predicting an end to escalating offers in the greater Portland area anytime soon.

“Bidding wars are fueled by good old-fashioned supply and demand,” she said.

News that the Federal Reserve may raise it benchmark short-term rate twice by late 2023 keeps buyers motivated to lock into rock-bottom mortgage interest rates.

A 30-year, fixed-rate mortgage has been at 2.93% since June 17, granting buyers more purchasing power. An additional $10,000 sale price adds $35 — about the cost of a dinner out — to a monthly mortgage payment.

Compounding an anemic amount of homes for sale is the state’s growing population, September 2020 wildfires that destroyed more than 4,000 Oregon dwellings and a lack of new construction. Oregon has long had the largest housing shortage in the nation, according to the Federal Home Loan Corp or Freddie Mac.

“There are so many factors that brought us to this point…

Read More: High demand fuels Portland’s rocketing housing prices: Median sale price jumps