Portland, Oregon Real Estate Market, September 2023 Report

Decreasing buyer activity and increasing inventory is leading to price drops, signaling the beginning of the end of the seasonal spring and summer seller’s market. Both trends will likely continue – leading to the favorable buying conditions of more available homes and less competition – throughout September, until inventory typically starts to drop again in October (often a short second second wind in the market before the major holidays hit).

Let’s get into the current Portland real estate market numbers.

Portland Home Buyer Traffic is Lukewarm

As you can see from these the weekly RMLS buyer traffic report above, buyer activity has remained somewhat steady (but lukewarm) this summer and is likely to drop further as summer ends.

We created the chart below to illustrate how buyer traffic numbers affect the housing market. Currently traffic remains in the lukewarm range, though we expect numbers to start dropping as fall arrives.

Oregon weekly home buyer trafficHot or Cold?
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 – Rising Fast

Combining a rising inventory chart with a steady but soon to be dropping buyer traffic report, shows the difficult in selling in late-summer, before inventory starts dropping again, typically in October. Portland real estate inventory has continued to climb since May, while buyer traffic has remained fairly steady. As we predicted last month, the increasing number of available homes has shifted the market to lukewarm status in the month of August, as you can see highlighted on both charts below.

Inventory as of August 16, 2023. Chart courtesy of Fidelity National Title.
Portland inventory rankingHot or Cold?
0 – 500On Fire (notice April of last year)
500 – 750Hot
750 – 1,000Warm
1,000 – 1,250Lukewarm (Currently)
1,250 – 1,500Cool
1,500 – 1,750Cold
1,750 – 2,000 +Frozen (last Oct. – Dec.)

The housing market of 2023 has been cooler overall, due to a variety of factors including high interest rates and inflation, translating to the shorter selling season that is now drawing to a close. More productive years have seen high levels of home sales last through the summer and even into early fall.

More Homes are Experiencing Price Drops

Percentage of Listings with a Price Decrease as of August 16, 2023. Chart courtesy of Fidelity National Title.

The number of detached homes on the market with price drops began increasing in June and is continuing to rise. Roughly 40% of homes have now undergone price decreases, and with current buyer traffic slowing down we expect that percentage will only increase in the coming months.

Average Prices are Starting to Decrease (slightly)

Price per sq. ft. as of August 16, 2023. Chart courtesy of Fidelity National Title.

While prices have remained relatively stable since May, the chart above reveals a turn toward lower prices that is consistent with the numbers of active homebuyers and higher levels of inventory we’re now seeing. If these two trends persist as we anticipate them to, prices will begin to drop more significantly as Fall approaches.

New Listings and Pending Sales are Decreasing

Less Home Sales Overall – Huge Trend

One of the big real estate trends that started in the fall of 2022, is still continuing today. Less sellers want to sell due to a softer market (and their likely lower interest rates on their current home) and less home buyers want to buy due to the higher cost of obtaining a mortgage. As you can see from the charts above, the reduction of overall home sales is significant, at times over a third less transactions.

New listings for detached homes dropped significantly in number from June to July, following the trend of the last two years as illustrated on the top chart. This is the time of year when fewer sellers are listing their homes on the market as buyer demand wanes.

Pending sales also dropped from June to July at a rate similar to the previous month, and while recent years saw a slight increase in sales from July to August, based on seasonal market trends we can reasonably expect overall sales to continue to decline for the remainder of the year.

Both of the charts above demonstrate the reality that the housing market of 2023 was much less active overall than it has been in previous years, with a similar trajectory but much lower numbers of new listings and pending sales.

The Best Time to Sell Your Home

Buyer activity drives the state of the market, and more buyers means competition that keeps prices in the ideal range for sellers. Buyer activity is starting to slow down, and with a smaller pool of buyers many sellers are having to reduce their prices in order to sell. If you are not prepared to list your home immediately or willing to sell at a competitive price, it would be wise to wait until the Spring when the market is always reenergized with new home shoppers and conditions are more beneficial for sellers.

An Opportunity for Home Buyers

The average decrease in price for homes on the market combined with the growing inventory of available homes is shifting the market to favor buyers. Conditions should only improve over the next several months as inventory continues to increase while prices continue to drop, so now is a great time to begin searching for a new home, before your choices (inventory) starts to decline in October.

Work with Experienced Realtors

We have been assisting buyers and sellers in the Portland metro area for over twenty years and will provide you with top-notch customer service whether you are getting ready to buy your first home or list your home on the market. Reach out to our top 1% home buyer’s and seller’s teams by calling 503-714-1111 or chatting with the bot on this site. We’d love to get started today!

August 18, 2023

Stephen FitzMaurice

Stephen FitzMaurice, Realtor is a top 5% real estate agent in the U.S. A Principal Broker in Oregon, Managing Broker in Washington, he has been licensed since 2003 for residential real estate sales. Call his team in Oregon at 503-714-1111 or in Washington at 360-345-3833.

4% max to sell a home in Portland and SW Washington.
4.5% max to sell a home in Salem and Bend.
Over 2,000 homes sold.