Summary: The decision to buy a house can be a tough one, especially when you’re trying to time it right. Should you buy a home in Portland now, or wait until later in 2020 to make a move? This article will help you make that decision.
We’re only early on in the year, but a lot of home buyers in the Portland, Oregon metro area are considering when to make their move to get into the local housing market. Many of them have the same question:
Does it make sense to buy a house in Portland right now, or would I be better off waiting until later in 2020?
Answering this kind of question requires equal parts soul-searching and market research. To help you with the market aspects, we’ve compiled some recent stats and trends. The following information will help you weigh the pros and cons of buying a home in Portland now, versus waiting until later on in the year.
Related: Free Home Buyer Guide
Buying a Home in Portland Now, Versus Later in 2020
The first thing you should know is that home values across the Portland, Oregon metro area are still much higher than the national average. While the national average home price is $244,000, the median price in Portland is currently $454,600.
That said, home prices in Portland have actually dipped slightly from the same time the year before and remain rather stagnant as of the time of this writing. According to Zillow, prices are expected to increase 2.3% within the next year.
That said, no one can predict future home-price trends with complete accuracy. So it’s difficult to say. It’s still possible for prices to rise further into 2020, as real estate increases in value over time, despite some fluctuations along the way.
Slow and Steady Gains in 2020
Right now, the real estate market in Portland, OR is rather neutral. Prices have barely moved over the past 12 months are are just about the same as they were 12 months ago. That said, things should pick up slightly through 2020, with modest price increases expected through the year, as mentioned above.
There is still a high level of demand and competition within the Portland real estate market. And the neutral trend right now is a function of housing affordability rather than buyer demand.
Home prices in the area have risen much faster than wages and incomes in recent years, and this kind of trend is generally unsustainable over the long term. So it appears that the real estate market has “self-corrected” in the form of slower price growth.
Housing Inventory Still Remains Relatively Tight
There is still something of an inventory and shortage in the area, and this will affect those buying a home in Portland now and later on in 2020.
A “balanced” real estate market is considered to be one with around six months worth of supply. When supply falls well below that level, you have a sellers’ market situation. This is what we are seeing in the Portland area at present. In February 2020, when this article was published, the city had about 3 months’ worth of supply. That’s far lower than what a balanced market is supposed to look like.
Home buyers who purchase a house in Portland now or later on in 2020 may still encounter stiff competition from other buyers.
The city is attracting new residents from all over the country, particularly those who are fleeing the exorbitant home prices in California. The resulting population growth has boosted demand for housing, putting upward pressure on house values.
Related: Best Neighborhoods in Portland
What Will Mortgage Rates Do Later in 2020?
Mortgage rates are another big consideration for those who are considering buying a home in Portland in 2020. The question on everyone’s mind is, will mortgage rates rise or fall between now and the end of 2020?
Interest rates are even harder to predict than home prices. But that doesn’t stop people from trying.
Each month, the Mortgage Bankers Association (MBA) publishes a finance forecast that includes a variety of economic indicators.
According to Freddie Mac, interest rates for a 30-year fixed-rate mortgage with conforming loan balances currently sits at 3.45% as of February 6, 2020. Rates continue to decline, making mortgages more affordable. That, coupled with a strong labor market, is creating more demand among borrowers looking to take advantage of the current situation and get into the real estate market.
Not only are mortgage interest rates slightly lower from the month before, they’re also much lower than where they were last year. And if rates continue along this path, people buying a home in Portland in 2020 can take advantage of lower borrowing costs. According to industry experts, rates are supposed to remain relatively stable throughout the year and finish the year under the 4.0% mark.
Here’s the bottom line to all of this: Nobody can predict future mortgage rates or home prices with total accuracy. But current market conditions suggest that home prices in Portland, Oregon will likely rise over the coming months. So a case could be made for buying a home now versus later on in 2020 — at least where costs are concerned.
Disclaimer: This article includes various forecasts and projections relating to the Portland housing market in 2020. These reports were produced by third parties not associated with our company. We have compiled and presented them here as an educational service to our readers.
Related: Why Now Maybe Great Time to Buy
Looking to Apply For a Mortgage?
If you have questions about Portland, Oregon mortgage loan eligibility requirements, or other aspects of the program, we have the answers. Want to get pre-approved for a home loan, or request a mortgage rate quote? We can help. Sammamish Mortgage is a local, family-owned company that provides mortgage programs to borrowers in Portland and the surrounding Pacific Northwest. Please contact us if you have mortgage-related questions.