Portland, Oregon Real Estate Market, February 2024 Report

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The Portland housing market is currently balanced, with a significant drop in available home inventory and slow buyer traffic combined with a slight increase in prices. These conditions signify that homes are starting to sell again and the market is gaining strength as we draw closer to the Spring seller’s market. Right now opportunities exist for both buyers and sellers while prices and inventory remain low. Let’s take a look at the numbers and statistics that are shaping our current market conditions.

Portland Home Buyer Traffic is Slow

Buyer traffic has been slowing down overall since Summer with a few dips and increases, and has now decreased by over 2,000 home viewings since our report last month. As demonstrated on the graph from RMLS below, the current level of buyer activity has dropped within the “cold” range (according to our breakdown on the chart underneath) in terms of the state of the Portland housing market. Every year the holidays typically deter buyers and sellers and the real estate market experiences a lull until the market begins to warm up again with the approach of Spring. We anticipate that buyer traffic will remain slow through the winter season until the seasons change and a stream of new buyers enters the market.

The chart we created below is based on our extensive experience and translates how buyer traffic numbers impact our local housing market. Low buyer activity reflects a cooler market overall, and if we enter the current number of buyers on the chart, we can see that the market has now slowed to cold status. We expect numbers to remain relatively stable or to decrease slightly in the upcoming weeks.

Oregon weekly home buyer trafficHot or Cold Market?
0 – 5,000Frozen
5,000 – 10,000Cold
10,000 – 15,000Cool
15,000 – 20,000Lukewarm
20,000 – 25,000Warm
25,000 +Hot

Portland Real Estate Inventory is Dropping

The number of homes on the Portland market began decreasing toward the end of 2023 and inventory is continuing to drop, as shown on the Fidelity chart below. The chart also reveals the pattern of home inventory levels over the past three years, and as you can see, numbers tend to drop through the winter season before resuming an upward climb in April or May. As we predicted in our last report, further decreases in available home inventory have now shifted the market to warm status, which we have illustrated on our chart below. We anticipate the drop in inventory will continue until the advent of Spring.

Inventory as of January 26, 2024. Above chart courtesy of Fidelity National Title.
Portland inventory rankingHot or Cold Market?
0 – 500On Fire (notice April of 2022)
500 – 750Hot
750 – 1,000Warm (Currently)
1,000 – 1,250Lukewarm (Currently)
1,250 – 1,500Cool
1,500 – 1,750Cold
1,750 – 2,000 +Frozen (last Oct. – Dec.)

While there are fewer available homes on the market and a low number of active buyers, the market is fairly balanced and can provide opportunities for buyers and sellers alike. Sellers may want to list their homes to take advantage of the competition resulting from low supply, and buyers may want to start actively searching before a wave of new buyers enters the market, inevitably driving prices upward.

The Number of Homes with Price Drops is Decreasing

Percentage of Listings with a Price Decrease as of January 26, 2024. Chart courtesy of Fidelity National Title.

Since our last report, fewer homes are experiencing price drops as our current low inventory is likely contributing to steadying prices. Approximately 41% of homes on the market have had price decreases, compared to 52% in December. This decline is consistent with the trend of diminishing price drops throughout the Winter in recent years demonstrated in the chart above, and we expect to see fewer price drops as we approach the Spring seller’s market.

Average Prices are Starting to Increase (Barely)

Price per sq. ft. as of January 26, 2024. Chart courtesy of Fidelity National Title.

Average home prices (calculated by price per square ft.) have been steadily declining since July, but prices started to increase again at the end of last month. Despite slow buyer traffic, our current low inventory reveals that homes are selling, and this slight price increase is a result of competition for a limited number of homes. Since home inventory typically does not increase significantly until the Spring each year, prices should continue to gradually increase for the next several months.

New Listings and Pending Sales Decreased in December

New home listings in December dropped at a rate similar to that of 2021 and 2022 and were nearly equal in number to the previous year. As illustrated by the top graph from RMLS, new listings in 2023 followed a similar trajectory to the previous two years with a steady overall decrease from the summer months onward. Now that the holidays are behind us, new listings will likely slowly increase as we draw closer to the spring season.

Pending home sales continued to decrease as well, but not as dramatically as in the previous two years, and last month’s sales slightly surpassed those in December of 2022. The holiday season contributes to a decline in sales each year, but as we progress through the early months of the year pending sales should gradually begin increasing.

The housing market of 2023 underperformed compared to the last two years, but by the last quarter of 2023, its performance more closely matched that of 2022. Ongoing high interest rates and inflation were the main factors discouraging potential buyers and sellers, and if you are interested in learning about their impact on the real estate market in 2024, you can read our forecast here.

The Ideal Time to Sell Your Home

We have spent decades working with sellers in the Portland metro area and observing the annual cycles of the housing market. If you are thinking of selling your home, this is the best time of year to start so that you can be ready to list early in the Spring. We tell our clients to aim to put their home on the market ideally in March, but sellers will also benefit from listing in April or May. Early spring is the time of year when local buyers are the most motivated (high buyer traffic and low inventory) and the resulting competition leads to increasing prices.

The Time is Now for Home Buyers

Though there are currently fewer homes on the market to choose from and prices have risen slightly, low buyer traffic means prospective home buyers will experience less competition for available homes. Prices are also likely at their lowest before the market shifts to favor sellers in the Spring. We recommend starting your search for a new home at PortlandHomesForSale.com. It offers comprehensive search features, including the option to search by Portland neighborhood or by custom filters, such as “biggest price drop in the last 7 days” to help refine your results.

Work with the Top Portland Real Estate Team

Whether you are shopping for your first home or getting ready to sell, our top 1% home buyer’s and seller’s teams are prepared to help you every step of the way. We’ll use our extensive knowledge of the Portland real estate market to help you discover the perfect home or employ our optimized marketing strategy to give your home the best possible exposure. On top of this, we provide top-notch customer service at a lower-than-average commission rate. Call 503-714-1111 or chat with the bot on this site to get started. We’d love to connect today!

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