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Portlanders’ IKEA Dreams Come True
Yep, Portlanders…your meatball dreams….I mean, Swedish home furnishing fantasies come true in late July. Ahead of schedule even.
From the Oregonian:
Swedish home furnishings retailer IKEA announced today its first Oregon store will open at 9 a.m. Wednesday July 25.
The 280,000-square-foot store, on 19 acres, will anchor Cascade Station, a 120-acre mixed-use development planned to include office, hotel and retail near Portland International Airport. The store is under construction at the southwest corner of Interstate 205 and Airport Way.
Like many of its more than 250 stores worldwide, IKEA’s Portland store will offer 50 different room settings, three model homes, supervised children’s play areas and a 250-seat restaurant serving Swedish specialties.
A MAX light rail stop is located near the front of the store, which will include about 1,200 parking spaces and 75 bicycle racks.
True to Portland form, it means you can haul your Effectiv modular desk set home on mass transit (or by bike), if needed. Until now, Portlanders had to hump it up I-5 to Renton, WA (a Seattle suburb) for their fix of Scandinavian-design furniture and Swedish meatball lunch.
[tags] IKEA, Portland, Oregon, shopping [/tags]
Best Remodel Bang for the Buck
If not in the market to upgrade or downsize your home, you may be looking to plow some money into a remodel project. I am often asked, “What are the projects that will yield the best return at the time of resale?”
REMODEL Magazine (and the National Association of Realtors) attempts to answer those questions annually in their “Cost vs. Value” study. They survey over 100,000 agents and appraisers across the nation to determine the value estimates for various home improvements. Here is a sample of their findings for Portland (and the West Coast*) vs. the national average:
| Job Cost | Resale Value | Cost Recouped |
National Avg. |
|
| REMODELS | ||||
| Minor Kitchen Remodel |
$18,241
|
$16,855
|
92%
|
85%
|
| Bathroom Remodel |
$14,731
|
$15,013
|
102%
|
85%
|
| Home Office Remodel |
$20,936
|
$14,037
|
67%
|
63%
|
| Basement Remodel |
$62,103
|
$57,381
|
92%
|
79%
|
| ADDITIONS* | ||||
| Bathroom Addition |
$34,311
|
$31,195
|
91%
|
75%
|
| Deck Addition |
$16,297
|
$14,846
|
91%
|
77%
|
| Family Room Addition |
$88,731
|
$72,247
|
82%
|
72%
|
| Master Suite |
$111,157
|
$95,916
|
86%
|
73%
|
| REPLACEMENTS* | ||||
| Roofing (midrange) |
$17,060
|
$15,160
|
89%
|
74%
|
| Siding (fibre-cement) |
$13,859
|
$13,783
|
102%
|
88%
|
| Window (vinyl) |
$15,200
|
$14,679
|
97%
|
85%
|
Siding and window replacements appear to have a 1:1 return ratio, along with a bathroom remodel. I tend to think the Portland/West Coast* returns are higher primarily to a stronger housing market than the rest of the nation.
Perhaps your first decision should be to repair any obvious defects or worn-out features (a subject for a future article). If you intend to sell your home in the near future, and you think some items will be flagged by a professional home inspection, get them fixed now.
Other remodels and upgrades can improve energy efficiency, curb appeal, and livability, but some won’t pencil at resale time. You might want to check with an agent before investing in a major remodel or addition. Will granite counters and solid wood floors be out of place in your neighborhood? Will that family room addition make your home the largest on the block? Will you get your investment back, lose money, or come out ahead if you intend to sell in the near future?
* ADDITIONS and REPLACEMENTS data are regional numbers (AK, CA, HI, OR, WA), whereas the REMODELS information is specific to the Portland market.
Contact me for more information from REMODEL magazine’s report.
[tags] real estate, home, house, remodel, replacement, addition, value, construction [/tags]
PSU Delivers Q1 Real Estate Report
Our very own Portland State University’s Center for Real Estate has released its quarterly real estate report, covering residential and commercial properties. This report also comments on the apartment market and downtown condos.
Their summary:
For some time, the Northwest has been the last holdout against the nation-wide housing slump. While several areas are still showing appreciation in Oregon, some preliminary signs that the market might dampen are beginning to emerge. Longer days on market and slowing appreciation are two key indications. In addition, there is the decline in net migration of 8.1% from 2005 to 2006. Finally, Oregonians are getting squeezed by energy prices, due to the high cost of fuel from Alaska, which could increase sensitivity to housing prices. While Oregon as a whole will not likely see a plummet as other markets such as Boston have, housing prices and transaction activity will stagnate under current conditions.
Some Findings:
- The housing market has plateaued compared to 2005-2006 when measured by number of days homes are marketed (increasing) and by measuring the actual sale price against the original list price (decreasing).
- Comparing Q1 of 2006 and 2007, the highest appreciating communities were Oregon City/Canby, Lake Oswego/West Linn, Columbia County, and Yamhill County–all at 15 to 17% appreciation.
- Apartment rents are on the rise for the first time since 2002. Condo conversions have reduced available rental inventory, and out-of-state investors see value opportunities in the relatively inexpensive Portland market.
- Instead of selling out in pre-construction phase as in years past, the downtown condo market will take some time to absorb the 1,600 new condo units that will come available over the next 6 months. But, compared to other markets such as Las Vegas and Miami, the Portland market is viewed as a more rational and cautious development environment.
Here’s the link to the report.
[tags] Portland, Oregon, housing, market, real estate, homes, prices, appreciation, values, Portland State University, PSU [/tags]
Best Buyer Advice: From a REALTOR or Your Hair Stylist?
After the furor raised over the 60 Minutes ‘investigative’ reporting, it’s time to lighten up.
Our friends in the Great White North (eh!) have taken a light-hearted approach to enlighten consumers on the value of using a REALTOR in their home buying or selling. Perhaps the NAR marketing and PR folks should take note.
“How REALTORS Help” courtesy of the Canadian Real Estate Association.
REALTOR or Personal Trainer?
Watch video on YouTube.
REALTOR or Mother-in-Law?
Watch video on YouTube.
Hat tip to Stephen Jagger at Ubertor blog in Vancouver, BC.
[tags] real estate, comedy, video, YouTube, Canada, REALTOR [/tags]
Market Activity – April 2007
The Portland metro real estate market continues its steady, but slow ways, with some communities enjoying stellar appreciation rates, and others coming back to earth. Compared to April 2006, new listings are up 23%, closed sales are flat, and pending sales are down about 7%.
Communities like Lake Oswego/West Linn, Hillsboro, Gresham, and Milwaukie are still appreciating at 12 to 15% clips. And with its 17-percent gains in appreciation, Yamhill County has overtaken Southeast Portland on the basis of average home price.
Oregon City, downtown and west Portland, Beaverton, and Tigard/Tualatin/Sherwood are seeing a relative flattening of appreciation–as low as 4% for the Tigard/Wilsonville area.
The year-to-date average home sale price throughout the Portland metro area is now $333,100; the median value is $282,500. Looking at 12-month averages and median compared to the same period last year, both numbers are showing over 11% appreciation.
Over 11,300 homes are currently on the market throughout Portland and its suburbs. Homes are taking, on average, 63 days to sell (up from 44 days this time last year). If no new homes were put on the market, the existing inventory would take nearly 4.5 months to clear out at the current pace of sales. A buyer’s market (where buyers have an upper hand in negotiating purchases) typically carries 5 months or more inventory. It seems that the market is at a stalemate; sellers aren’t getting as many offers and buyers aren’t getting many lowball offers accepted.
Below are year-to-date average and median sale prices, plus 12-month average appreciation rates by community:
| Area | YTD Avg. Sale Price | YTD Median Sale Price | 12-Mo. Appreciation |
| Lake Oswego / West Linn | $540,100 | $455,500 | 14.1% |
| West Portland | $445,900 | $365,000 | 6.7% |
| NW Washington County | $390,600 | $351,500 | 7.2% |
| Tigard/Tualatin/ Sherwood/Wilsonville | $374,900 | $336,000 | 3.9% |
| Milwaukie / Clackamas | $341,300 | $307,500 | 12.6% |
| Oregon City / Canby | $313,800 | $294,200 | 9.8% |
| Northeast Portland | $307,400 | $270,000 | 10.4% |
| Hillsboro / Forest Grove | $298,600 | $268,000 | 14.5% |
| Beaverton / Aloha | $298,400 | $269,000 | 14.0% |
| Gresham / Troutdale | $281,900 | $257,800 | 14.9% |
| Yamhill County | $280,100 | $246,400 | 17.8% |
| Southeast Portland | $278,900 | $245,200 | 12.9% |
| North Portland | $263,000 | $245,000 | 12.0% |
| Columbia County | $251,000 | $240,000 | 13.4% |
Source: RMLS, May 2007.
60 Minutes & The 6-Percent Solution
Last night, 60 Minutes ran a story on the state of real estate service and commissions…and one company’s efforts to upset the apple cart.
The story highlighted the efforts on an Internet startup company, Redfin, that is currently operating in Seattle, Boston, LA, San Diego and San Francisco. Redfin is a pure online, discount real estate brokerage, providing web-based access to home searches….and making offers. No agent needed for home tours or other pre-offer services. Redfin’s big claim to fame is that their buyers’ agent service refunds 2/3 of their sale commission back to you.
60 Minutes portrayed Redfin’s efforts as similar to Amazon, Expedia, and ETrade’s transformations of their respective industries. In particular, the program attacked the ’sacrosanct 6%’ commission and the efforts of full-service real estate agents.
It was a great PR moment for the company and its outspoken CEO, but as a ‘consumer protection’ story, 60 Minutes was a little light and free with some facts. (See real estate agent responses at ActiveRain.)
A few personal thoughts:
- The “sacrosanct” 6% commission figure “on every house they sell” comment is misleading, to say the least. The national average is 5.2%. And you have brokers in Portland that work for flat rate, 1% seller fees, and up to 6% (or more) for ‘full service’. The local consumer has many choices, ranging from price-conscious to service-conscious offerings.
- Oregon residents: Before you ask your buyer’s agent to refund 2/3 of their sales commission back to you, be aware that such rebates are currently illegal here. For better or worse, Redfin won’t be coming to Portland soon.
- Are homes considered a commodity product like airline tickets, books, and stocks? I continue to hear that real estate is the next industry to be transformed by Internet-based business models, but haven’t met anyone that did not want to visit, inspect, and thoroughly consider their next home or investment property with a knowledgeable agent. See Kris Berg’s excellent post at Bloodhound Blog.
- I found it interesting throughout the interviews that Redfin agents (and CEO) refer to their real estate activities as ‘deals’? My clients don’t consider themselves or the purchase/sale of their home as ‘deals’.
Redfin and others with similar business models will be appreciated by the tech-savvy, independent, and most of all, the cost-conscious and experienced homebuyer. But the majority of consumers will probably prefer something more ‘traditional’–a hands-on level of service offered by knowledgeable, engaged agents out in the market, not behind computer screens.
Here is the 60 Minutes video.
For another Oregon agent opinion, visit ProseCity.
[tags] 60 Minutes, real estate, commissions, homes, houses, buyers, sellers, NAR, Redfin [/tags]
Image by fernando_graphicos. Used under Creative Commons license.
Week Links – May 11, 2007
This was a good public relations week for the City of Roses, as several major media entities noted the city for its strong housing market and livability factors.
Where Home Prices Are Hot Now Despite the Housing Slowdown — Wall Street Journal
The housing news isn’t all grim. Even as prices sag nationwide, there are several cities in the country where home values are climbing smartly.
Cities Ranked and Rated — Sperling’s Best Places
Portland weighs in at #3 out of 400 U.S. cities, just behind Gainesville, FL and Bellingham, WA. 2nd edition book analyzes ten variables such as cost of living, jobs, climate, education, healthcare, crime, and transportation. Corvallis, Medford & Bend also rank high.
Real Estate Report Card: Five Best & Worst Markets — CNBC
Portland is in at number 2, behind Seattle in the Best category.
Sten proposes statewide real estate tax — PSU Vanguard
Tax, fee would fund new plan to increase amount of affordable housing in Portland area. Portland City Commissioner Erik Sten has a plan to increase the amount of affordable housing in Portland by implementing a statewide real estate tax and by putting a fee on documents used in real estate deals.
[tags] Portland, Oregon, housing, homes, real estate, market, tax, appreciation, affordability [/tags]
Photo by josh bancroft. Used under Creative Commons license.
Portland-Area Farmers’ Markets Ripen for Business
Portland-area farmers’ markets are opening this month, gearing up for the bountiful summer season. Virtually every Portland neighborhood and suburb has a weekly market, flush with fresh, local-grown fruit, vegetables, plants, plus crafts, artwork, music, and more.
Local farmers’ markets are broadening their appeal beyond just local foodies. Many markets are making it easier for lower income families to shop, as well as offering modern transaction services. From the Oregon Farmers’ Market Association:
Farmers’ Markets are increasingly offering electronic services on their market site. These electronic services have expanded sales through the use of food stamps, debit and credit card transactions.
Additional information about can be found at the Oregon Farmers’ Market Association.
Below is a list of local markets, their general location, and dates/hours:
| CITY | SCHEDULE | SEASON | LOCATION | SITE |
| Beaverton | Sat. 8:00-1:30 | May-Oct | Hall Blvd, bet. 3rd & 5th St. | website |
| Beaverton (Wed.) | Wed. 2:00-6:00 | June-Aug | Hall Blvd, bet. 3rd & 5th St. | website |
| Boring | Sun. 9:00-2:00 | June-Sept | Hwy 212 & Wally Rd. | |
| Cedar Mill | Sat. 8:00-1:00 | May-Oct | NW Cornell, 1 blk W of Murray | website |
| Canby | Sat. 9:00-1:00 | May-Oct | 1st Ave @ Holly Street | |
| Estacada | Sat. 9:00-2:00 | May-Oct | 3rd & Broadway St | website |
| Fairview | Thur. 4:00-8:00 | April-Oct | Fairview City Hall, 1300 Village St. | website |
| Forest Grove | Wed. 4:00-8:00 | May-Oct | 21st Ave, bet. College & Main | |
| Gresham | Sat. 8:30-2:00 | May-Oct | Miller St bet. 2nd & 3rd | website |
| Hillsboro (Sat.) | Sat. 8:00-1:30 | May-Dec | Courthouse Square, 2nd & East Main | website |
| Hillsboro (Tue.) | Tue. 5:00-8:30 | June-Aug | Main St., 1st to 3rd Ave. | website |
| Hillsboro (Orenco) | Sun. 10:00-2:00 | May-Oct | NW Cornell Rd & Orenco Station Pkwy | website |
| Lake Oswego | Sat. 8:30-1:30 | May-Oct | Millennium Park, 1st & Evergreen | website |
| Milwaukie | Sun. 9:30-2:00 | May-Oct | SE Main bet. Harrison & Jackson St. | website |
| Oregon City | Sat. 9:00-2:00 | May-Oct | Clack. County Public Service lot | website |
| Portland (Alberta) | Thur. 3:00-7:00 | May-Sept | NE 15th and Alberta | |
| Portland (Hillsdale) | Sun. 10:00-2:00 | May-Oct | 1407 SW Vermont | website |
| Portland (Hollywood) | Sat. 8:00-1:00 | May-Oct | NE Hancock bet. 44th & 45th, | website |
| Portland (Interstate) | Wed. 3:00-7:00 | May-Sept | Overlook Park, N Fremont & Interstate | website |
| Portland (Lents) | Sun. 9:00-2:00 | June-Oct | SE 92nd and SE Foster | |
| Portland (Montavilla) | Sun. 10:00-2:00 | July-Sept | SE 77th and SE Stark St. | website |
| Portland (Moreland) | Wed. 3:30-7:30 | May-Sept | SE Bybee and SE 14th St. | website |
| Portland (OHSU) | Tue. 3:00-7:00 | May-Oct | McKenzie Hall Courtyard | |
| Portland (People’s) | Wed. 2:00-7:00 | Year-round | 3029 SE 21st Avenue, | website |
| Portland (EastBank) | Thur. 3:30-7:30 | May-Sept | SE 20th, bet. Hawthorne and Belmont | website |
| Portland (PSU) | Sat. 8:30-2:00 | April-Dec | South Park Blocks between | website |
| Portland (Downtown) | Wed. 10:00-2:00 | May-Oct | SW Salmon & Park | website |
| Portland (Ecotrust) | Thur. 3:30-7:30 | June-Sept | NW 10th bet. Irving & Johnson | website |
| Rainer | Sat. 10:00-3:00 | May-Sept | Riverfront Park on “A” Street | website |
| Scappoose | Sat. 9:00-2:00 | May-Sept | 1st & E. Columbia Ave | website |
| Sherwood | Sat. 9:00-1:00 | May-Sept | City of Sherwood City Hall | website |
| Tigard | Sun. 9:00-2:00 | May-Oct | Washington Square Too Parking Lot | website |
| Troutdale | Sat. 10:00-3:00 | April-Nov | 473 E. Historic Columbia River Hwy | website |
| West Linn | Wed. 4:30-8:30 | May-Sept | 1725 Willamette Falls Drive | website |
[tags] Portland, Oregon, farmer, markets, organic, produce [/tags]
Photo by kittycat. Used under Creative Commons license.
Real Estate Ethics Guru, Ted Truitt
Every agent worth their salt is always looking at improving their knowledge base and service level through professional development and continuing education. Many agents have designated themselves as disciples of real estate gurus like Mike Ferry, Brian Buffini, and Tom Hopkins.
I have been thinking about my own development lately, and while I haven’t had the time to download the Russell Shaw material from Bloodhound Blog, I think I may have found my mentor: Ted Truitt, ethics specialist.
That “Golden Rule” thing is totally overrated. You can experience a taste of Ted’s proven system at http://www.tedtruitt.com.
On a serious note, all members of the National Association of Realtors must abide by their Code of Ethics. Not all agents are members of the NAR.
[tags] ethics, parody, video, Realtor, Virginia, Ted Truitt, agent, real estate [/tags]
Help on the Horizon for Subprime Borrowers?
Today’s post comes from Matt Harris, a dynamic and engaging mortgage broker with LoanSource Funding in Portland. He has some updates on the latest in the subprime lending crisis.
The crash of the subprime market has been fueled by late payments, loan defaults, and foreclosures. Many people have lost their housing and millions of subprime borrowers fear the same.
As people look to the future, they are beginning to see what once may have been considered an easy re-finance is much more difficult and costly than expected. As this realization sinks in, so does anxiety about being able to make the new payments. Are there any solutions out there? Is there anybody that can help, and should they?
Currently, as lenders feel the pressure from borrowers and the market, there is a frantic attempt to save as many loans out there as possible. Obviously it is in the best interest of lenders to keep their loans from being defaulted upon. This has led to some abnormal measures in the lending world.
Fannie Mae and Freddie Mac, the two largest sources of mortgage dollars in the U.S., have decided to attempt to “bail out” subprime borrowers. These two government-sponsored home loan organizations are pledging to use $20 billion to aid struggling homeowners. Fannie Mae has introduced a plan entitled HomeStay with the goal of preventing foreclosure on loans already existing in their books. HomeStay will refinance people into new 40-year fixed rate mortgages and adjusting credit requirements. Ideally, this would keep payments low enough to prevent foreclosure.
The agencies also plan to purchase fixed and adjustable rate loans with the intent to have lenders offer them to subprime borrowers by mid-summer. In addition to the pledges by Freddie Mac and Fannie Mae, Washington Mutual has pledged $2 billion of its own private money.
Most people feel that something needs to be done in the subprime world, but there are mixed feelings as to what level the government and its agencies should be involved. There is also plenty of debate as to whether or not these plans will actually be effective. Congress has not officially announced any plans for aid, but there has been talk of a legislative fix. (Additional news from Congress at MSNBC.)
Opponents of these “bailout” programs point to the effectiveness of a similar plan in Ohio in which 508 borrowers applied for assistance and only 42 of them qualified to be “rescued”. Others are concerned that we may get into public assistance territory and cannot justify using taxpayers’ money to assist those that maybe should not have qualified for a home loan in the first place. A consensus among most people is expressed by Richard Syron, the CEO of Freddie Mac:
The ability to enforce a mortgage contract, including the use of foreclosure, is critical to continued investor confidence in the U.S. housing market.
This does in fact seem to be a concern of many of the parties involved. If we come to the rescue of people unable to make their mortgage payment, where has the integrity of the system gone?
Thanks Matt. Many pointing fingers to go around. Many complicit participants in the meltdown….aggressive lending policies, borrowers stretching beyond their means, and overly risk-tolerant institutional investors alike. It’s time for a compassionate, but rational, response.
I encourage you to contact Matt, whether it’s for first-time buyer, challenged-credit loan options, or conventional mortgage assistance:
Matt Harris
LoanSource Funding, LLC
2613 NE Martin Luther King Jr. Blvd., Suite D
Portland, OR 97212
(503) 998-6885
email
