Portland metro home sales price growth steadies
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Home prices are growing at a steadier pace in the Portland metro area than during the frenzied pandemic-era market we saw in the early 2020s, according to a recent analysis by Redfin.
Why it matters: This year, Portland's real estate market saw a continued slowdown of home sales due to a decrease in affordable housing and new stock.
- You can thank mortgage rates for that.
Case in point: Both potential buyers and sellers stayed on the sidelines to wait and see where mortgage rates would land before committing to a decision.
- Nearly half of the houses on the market this year saw price cuts as a result.
The big picture: When mortgage rates surged in 2022, and then barely budged in 2023, demand and home sales dropped.
- Mortgage rates are expected to remain elevated in 2025, though they could land somewhere closer to 6%, per a new Realtor.com forecast.
What they're saying: While high interest rates correlate with smaller year-over-year growth, it's important to remember the pandemic was an "anomaly" for the market, Chandra Noble-Ashford, a principal broker at Think Real Estate, told Axios via email.
- "If we set that data aside, we are in a place that shows steady growth in the Portland market at a rate that is more sustainable," she said. "We cannot support growth of over 20% YoY."
Between the lines: The region doesn't have many new single- or multifamily builds in the pipeline. According to the city's own analysis, an additional 120,000 homes need to be developed to meet affordability and inventory goals.
- Lack of new inventory has remained an issue for the metro area for the last decade due to rising costs of labor and financing.
Yes, but: New builds aren't as in demand as "nicely renovated vintage homes in beautiful neighborhoods" for Portland buyers, according to Rachel Freed, owner and principal broker of Urban Nest Realty.
- "Those are the houses that sell fastest and for the highest prices."
The bottom line: Despite the home sales price appreciation slowdown, both Freed and Noble-Ashford said the market remains active and anticipate more growth in the new year.
- "As rates come down, we will see more buyers enter the market, and that will mean that we have a short window of opportunity for buyers to have a position of power," Noble-Ashford said.