Portland Real Estate Condo Market 2021
Portland Condo Market 2021
- Condos finished better in 2020. As in all Portland market sectors, it was a rough spring, with buyer activity tanking in March. But things picked up again in summer, and the peak month for 2020 condo sales was September, when nearly 900 were sold. Numbers stayed strong through the remainder of the year, and the number of condos sold in the second half of 2020 was overall a pretty close match to the activity in 2019.
2. Condos span the price gradient. As you can see from the chart above, there are condos available across the Portland metro area in a range of prices. To generate your own graph showing change in condo prices over time (based on Zillow’s Home Value Index), go to https://www.zillow.com/home-values/ and type your city, zip or neighborhood of interest in the search bar. Then scroll to the “Market Overview” section and select condo/co-op from the drop-down menu.
3. Condos can be a good investment. The change in condo values over time across the metro area is positive overall. However, growth can be slow, especially in the City of Portland, where condo values actually fell between 2019 and 2020 (see RMLS chart below). If you’re looking for a starter condo that you can eventually sell at a gain, look for a well situated building in one of Portland’s many suburban areas. Then check the HOA fees and reserves. As prices go up over time, the value of your condo will grow, but if you’re paying high fees to the HOA, it will be difficult to get a return on your investment.
Pro tip: Use a smart condo home search program that adds the HOA fees, taxes, and misc. cost to the sales price so you can compare the total cost of condo ownership – in real-time – as you search for condos for sale online. Check it out here.
4. Condos fluctuate seasonally. As you can see from the above chart from the RMLS, the median sale price for condos (in a normal year) follows many of the seasonal ups and downs of the regular housing market. However, with strong economic growth in 2019, there were some changes to the pattern – no late summer or late winter dip in the median sale price, for instance. The year 2020 started out strong but saw a readjustment back to 2019 price levels after the beginning of the pandemic. However, the market seems poised for solid growth in 2021.
5. Condos will perform better in 2021. As we wrote about last month, Portland is currently seeing record low inventory, now this is referring to single family detached properties and not condos, but low inventory in the single family market will lead more home buyers to consider condos as an alternative. With new construction slow and sellers reluctant to move during the pandemic, a shortage of homes to choose from is driving up prices across the board. Look for good deals now before the expected growth in home prices over the 2021 buying seasons.
Condo Buying Tips
- Understand the pros and cons. If you’re doing research on the Portland condo market, chances are that you’ve already decided that the condo lifestyle is more “pro” than “con” for you. However, owning and living in a condo is significantly different than living in a home, so be sure you’ve thought it through before you commit. In addition, the pros and cons will vary based on where the condo is located. For example, if you’re buying in Portland, chances are you’re going to be living downtown, with great views and access to the city, but the value of your investment is not going to grow quickly. In an outlying area like Forest Grove, condos offer a taste of suburban living more affordably, and the unit may include more amenities.
- Get a condo-experienced agent. Having a real estate agent who has performed many condo sales, as well as one who knows the area well, is crucial. Your agent can steer you away from a condo unit notorious for bad management, for instance, because a poorly managed condo means higher costs for owners. They will help you review all the documents relevant to the sale and understand the HOA agreement as well as the financial statement. Buying a condo is more complicated than buying a regular home, because the condo association must also approve the sale. Without an experienced agent, deals often fall through. If you work with our top 1% buyers’ agent, however, you will gain from our experience closing hundreds of condo deals in the Portland area.
- Don’t rely on Zillow. The Big national portals have to dumb down their data in order to make it work nationally. Local websites with a direct connection to the Portland MLS will have more and better data. Check out PortlandHomesForSale.com’s smart condo search feature.
- Know the average HOA fee. It’s good to familiarize yourself with the range of monthly HOA fees charged across the Portland area, and what they cover. A too-good-to-be-true low HOA fee might mean you’re responsible for the exterior maintenance of the unit, including the roof. A high fee might indicate an HOA that’s struggling to pay for a long list of deferred maintenance, or it may be justified if the unit comes with a long list of amenities like a private park, pool, parking garage, etc. Overall, HOA fees vary by the size of the unit. In 2020, the average monthly HOA fee for Portland was $384, or 33 cents per square foot. Check out our full analysis here.
Are you ready to make 2021 your year to buy? Whether you’re looking for a condo, townhome, detached home, or a piece of land to call your own, our top 1% buyers agents are ready to work hard for you in the Portland real estate market.February 3, 2021