Portland
Oregon Real Estate - Live Green...Live Well!
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Patrick
Smith, MBA, AHWD
Eco Broker Certified
503-421-3824
Licensed in the State of Oregon
CONTACT PATRICK
4001
NE Halsey Street, Suite 100, Portland, Oregon,
97232
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Current Status of the Portland Real Estate Market: I Wish I Had Bought Then It is easy to get lost in the myriad commotion of today’s real estate market and even easier to fall victim to the Chicken Little rhetoric that dominates our headlines and news programs. Savvy investors and seasoned professionals will tell you, however, that we shouldn’t be focused on the immediate day-to-day events of the market. Rather, we should look at history and find comfort in what past housing trends have done in order to predict our future.
Recessions are not a new phenomenon – this is at least the fourth I have encountered in my lifetime. Of course, not all recessions are the same. This one is arguably either a result of the current housing market or resulted apart, but coincidentally at the same time, as the current housing market. Whatever theory you tend to believe it does not negate the fact that we are currently enduring a depressed market.
So, what do we do? These are the markets in which millionaires are made! How often have you heard others (or even yourself) say, “If only I had bought then”? In all likelihood, we probably have all said it at least once. The fact is Portland real estate is a fantastic investment opportunity and the primary obstacle keeping both first time home buyer’s and casual investors from making purchases is fear. Fear that the stock market will not recover; fear that they will purchase before we reach the bottom of the housing market; fear that interest rates will drop after they make a purchase. Quite frankly, fear will keep most of us from becoming wealthy.
In a previous blog I described how I look at home prices in relation to home purchasing activity to provide lagging indicators of where the market is headed. I suggested that once we saw at least three months of stagnant pricing coinciding with three months of increasing home purchasing activity that this would be a good indicator of an improving housing market – a housing market on the mend. All indications are that Portland home prices have stabilized within the past few months while home purchasing activity has slightly improved during January and February. What is significant is the fact that these tend to be, historically, two of the slowest months in Portland real estate activity. Does this mean the Portland real estate market is already beginning to recover? I do think it is still too early to make that prediction although it appears possible. Just as this is a different type of recession than recent past recessions, there are various volatile external influences on the housing market to accurately make such a bold statement.
But let’s be realistic and look to history: Home prices have never dropped and not recovered. In fact, real property continues to be one of the best investments in terms of year-over-year return-on-investment performance. The rapid home valuation period between 2003 and 2005 was a phenomenon derived from both deceit and greed and never should have happened. Those who fell victim to believing that any investment should grow at those unprecedented rates should now come back to reality and realize that market stabilization is both a good and necessary event. Steady growth over time will continue to support a healthy market environment. As such, push fear aside and let history and common sense be your guide to investing in Portland real estate.
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