Portland Real Estate Market Update – November 2021
It’s no surprise that home prices in Portland have increased over that past 18 months due to the COVID-19 pandemic. Problems with low inventory and buyers wanting to leave urban areas (Portland suburbs prices have risen faster than the city proper’s) or create better work-from-home situations have driven up real estate in the entire metro area.
This has also been true across the country. However, according to Forbes.com, home prices are starting to drop nationwide, citing increased inventory and buyer fatigue as causes. More likely though, this is just part of the normal season trends we see in the real estate market both locally and nationally every year.
Let’s see how these factors have affected Portland and if we can anticipate real estate price reductions here at home, as well.
Median Sale Prices for Homes in Portland
Our most recent RMLS monthly data reveals that the average sale price for a home in the Portland metro area in October 2021 was $575,200. This number is an increase of $3,700 over the average price in September 2021. While that might seem like a big jump, let’s not forget the importance of keeping an eye on the median sale price.
It’s useful to take both average and median sale and listing prices into account. Typically, average prices will be higher because high priced properties become “outliers.” That is, a high-priced property can easily skew the average to be higher than what most home buyers are looking for. For example, if a multi-million-dollar home sells one week, the average price will see a much more drastic shift than the median price. So, keeping an eye on the median, is a great way to be aware of the current market.
The median sale price for a home in the Portland metro area in October of 2021 was $516,000. The median sale price for a home in the Portland metro area in September of 2021 was $510,000. This is an increase of a 12.2% increase from September and a significant increase of 16.4% from a year ago. According to these numbers, Portland’s real estate market is not slowing down, at least not yet.
Cost of Portland Houses Versus Condos
As we noted earlier in 2021, the demand for houses had been much higher than the demand for condos in Portland for months. While on average condo prices will typically be lower, the market is still reflecting the difference in demand at the moment.
The median list price of Portland homes has been on a steady increase over the past year, rising $56,000 from October of 2020 to the current average of $575,200. Meanwhile the median list price of condos has dropped $75,000 from 2018 to today.
The images below from Fidelity.com show a comparison of median list prices for Portland homes and condos.
Average Days on the Market for Homes in Portland
Listing prices don’t tell us everything, however, because they don’t always reflect final selling prices. Another important factor for how homes are—or are not—moving is the number of days listings stay on the market.
RMLS data tells us that the average time on the market for homes in October 2021 was 26 days, down from 38 in October of 2020. That’s a decrease of almost 32%. As we’ve noted previously, Portland saw a significant drop in inventory at the end of 2020 and beginning of 2021. What we saw in October reflects a fall surge before the dark of winter sets in. This is common in October based on all of our previous seasonal real estate market research reports.
But the holidays are coming and historically the Portland real estate market nearly grinds to a halt over the Christmas and New Year season before bounding back quickly by mid-Jan. and then peaking in the spring.
The number of active residential listings in October was 3,232, down from 3,515 this time last year. That’s an 8.1% decrease, far better than the nearly 50% decrease we saw between 2020 and 2019.
The above chart is the total number of active homes for sale, including homes that have been lingering on the market and brand new listings. The chart below focuses on new arrivals to the Portland real estate market.
Slightly more properties went on the market in September of this year compared to last and slightly fewer in October. How all of this will play out as we look to a post-pandemic future is still up in the air. But if the demand for homes in Portland continues as it has in recent months, house prices will likely continue to go up, after perhaps a short holiday break.
Notable Trends in Portland Housing Prices
Of course, not all neighborhoods and suburbs of Portland saw the same changes over the year. The Lake Oswego/West Linn area continues to be one of the top cities when it comes property value. The average sale price of a home in Lake Oswego in October was $853,200, and they saw one of the highest increases in average sale price at 20.8% with homes on the market for 24 days. Mt. Hood is hot right now, with an average of only 7 days on the market and a price increase outdoing even Lake Oswego at 30.7%. Mt. Hood area is the hottest Portland suburb in all of 2021.
The lowest increase in the area was in west Portland, which came in at 11.9%, not an insignificant jump. Also, not surprising, considering that this section of Portland saw homes on the market for the longest time period—51 days.
Gresham/Troutdale continues to be one of the most affordable areas in Portland with an average sale price of $482,000 with homes going off the market at an average of 32 days.
Outlook for Portland Home Prices in 2022
At the moment, price per square foot has dropped only slightly for homes and risen slightly for condos.
Despite some slight ups and down, it’s likely that property values in Portland, which have remained strong throughout the pandemic, will continue to grow into 2022. See our initial 2022 Portland real estate forecast here.
Looking for a New Home?
With all that’s happened in the past year, Portland is still a desirable place to live for many. If you want to sell your home or find a new one, we can help you do that. Check out our top 1% buyers agents and our top 1% sellers agents today.November 12, 2021