Summary: If you’re considering buying a home in Portland, Oregon some time soon, then 2020 may be your year. With low rates, slowly rising prices, and a potential increase in inventory, 2020 could be a great time to buy. This guide will explain why.
The real estate market in Portland, Oregon has changed a lot over the past couple of years. Home-price appreciation has finally slowed down, after a long period of rapid growth.
That’s just one reason why 2020 could be a good time to buy a home in Portland. The winter of 2020, in particular, could be a great time to buy, due to the seasonal slowdown in the market.
Why 2020 Could Be a Good Time to Buy in Portland
Housing inventory continues to be tight in Portland. Right now, there is roughly a 2.5-month supply of homes in the city, which is much less than the 5- or 6-month supply that typically characterizes a balanced market. That said, experts believe that inventory may loosen somewhat in Portland in 2020, which will give buyers more options.
Further, the rapid home-price growth of the last few years has slowed to a more normal pace. This latter development should allow buyers to catch their breath, so to speak. These and other factors could make 2020 a great year to buy in Portland. Here’s what you should know about these trends.
1. Home buyers could have more inventory to choose from — finally.
Back in late 2015 and early 2016, Portland’s real estate market had about a 1-month supply of homes for sale. By June 2018, inventory had increased to about a 2.2-month supply. And by January 2020, that number increased slightly to a 2.5-month supply. This is a positive trend that could make things easier for home buyers planning to enter the market over the coming months.
New home construction is expected to increase, which should help alleviate the inventory situation to some degree, though not enough to bring the market to a balanced level. According to economists, new home construction is up and forecasted to increase 10% to 15% in coming years. The Oregon Office of Economic Analysis anticipates the number of housing starts to reach approximately 22,500 in 2020 alone.
To be clear, housing inventory in Portland is still well below what’s considered to be a “balanced” real estate market, which has 5- or 6-months supply of housing to meet demand. But the fact that supply may finally start to grow is a positive sign for buyers. It should give them more options, while easing competition a bit. It’s another reason why 2020 could be a good year to buy a home in Portland.
2. Slower home-price appreciation could relieve some of the urgency.
In January 2020, Zillow reported that the median home value in Portland was $454,600. That is roughly the same price as last January. Prices have fluctuated slightly over the past year, but they have not really gone in any one direction. Looking forward, the company predicts that the median price will rise by around 2.3% over the next 12 months (ending in January 2021).
That’s a much slower rate of home-price growth than we were seeing a few years back. From 2015 to 2016, for example, house prices in Portland rose by double digits. So the market appears to be returning to “normal,” at least in terms of year-over-year price growth.
With Prices Rising, Buyers Shouldn’t Wait Too Long
To recap: housing inventory may be increasing in the Portland area in 2020. Meanwhile, home-price growth has slowed down. Those are two reasons why 2020 could be a good year to buy a house or condo in Portland, Oregon.
But buyers shouldn’t mistake a “cooling” market for a “cold” one. There’s still plenty of competition within the local housing scene, due to the tight inventory conditions mentioned earlier. And prices are expected to rise. As a result, those buyers who postpone their purchases until later next year could encounter higher housing costs.
Want to Apply For a Mortgage in Portland?
Are you thinking about buying a home in Portland in 2020? If so, now may be a great time to take the plunge! When you’re ready, Sammamish Mortgage can help you get the mortgage you need to make that big purchase. We are a family-owned mortgage firm that serves all of Washington, Oregon, Idaho, and Colorado and offer many mortgage programs. Get in touch with Sammamish Mortgage today to apply for a mortgage or simply to have your questions answered!