The latest housing market forecast for Portland, Oregon suggests that home prices will rise modestly over the next 12 months, far less than the previous year’s gains.
But don’t let that fool you. The Portland real estate market is very active right now, with stiff competition among home buyers. A recent report showed that first-time buyers, in particular, are facing challenges.
Here’s an updated Portland housing market forecast, and a look at other real estate-related trends in the area.
Portland Home-Price Forecast Suggests Cooling Ahead
During the 12-month period from April 2016 to April 2017, the median home price in Portland, Oregon rose by around 10%. That’s based on an analysis by the real estate data company Zillow.
But homeowners in the area probably shouldn’t expect that level of price growth over the next 12 months. Zillow’s latest housing forecast for Portland suggests a more modest level of appreciation, going forward.
In April 2017, the company wrote: “The median home value in Portland is $414,800 … values have gone up 10.2% over the past year and Zillow predicts they will rise 2.7% within the next year.”
Historically speaking, house values in the U.S. tend to rise by around 3% annually (outside of bubbles, of course). Double-digit gains are abnormal, and in this case they were the result of supply and demand imbalance. So this latest home price forecast for Portland suggests a return to “normal” appreciation.
Housing Market Still Competitive, Especially for First-Time Buyers
While home prices could begin to cool in 2017, the Portland housing market itself will remain very active for the foreseeable future. First-time buyers in particular appear to be having a hard time finding suitable properties, according to a recent report.
Earlier in April, The Oregonian reported that “starter” homes (those toward the lower end of the pricing spectrum) are particularly hard to come by in the Portland metro area. The region’s growing population, combined with steadily rising home prices in the area, have made the Portland housing market challenging for first-time buyers in 2017.
To quote the Oregonian article: “[Housing] inventory in the ballpark of $300,000 is rapidly disappearing as prices far outpace wages, a scenario exacerbated by the continuing fallout of a home-building drought, the region’s surging population and the tendency of current homeowners to stay put instead of move up.”
In some cases, first-time buyers have to compete with house flippers, real estate investors, developers and other cash buyers. This increases the level of competition, particularly among lower-priced homes.
This doesn’t mean first-time home buyers can’t succeed in the Portland real estate market. They certainly can. It just means that the house hunting process might take longer than expected. Home buyers planning to enter the market in 2017 should have their financing squared away ahead of time, and should be prepared to move quickly when the right property comes along.
Disclaimer: This article contains home price and housing market forecasts for Portland, Oregon in 2017. These predictions were provided by third parties not associated with our company.