Comments on: Portland Real Estate Market Results – August 2008 Final

By: Portland Oregon Real Estate Agent Blog » Week Links - October 31, 2008

Portland Oregon Real Estate Agent Blog » Week Links - October 31, 2008 — Fri, 31 Oct 2008 19:14:17 +0000

[...] Shows PDX down 7.6% over 12 months Consistent with what you’ve read here, the August 2008 Case-Shiller home price index for Portland dropped 1.3% from July, and 7.6% from [...]

By: Uncle_Git

Uncle_Git — Thu, 25 Sep 2008 00:05:08 +0000

Given that builders are hacking prices and undercutting resale properties I think you see where it’s going.

Builders lead the way down in every correction as they don’t want the carrying costs etc.

Any builder who isn’t building is just slowly going out of business – they need the churn and with the current lending problems that means cutting prices.

FWIW – the new conforming loan rates for a 30 year fixed jumbo at Wells Fargo are now 9%…

So nothing requiring a mortgage of over $415k is going to be moving – get ready for the squish down with more higher priced properties sitting and the pressure on the high end increasing.

https://www.wellsfargo.com/mortgage/rates

By: Ni

Ni — Wed, 24 Sep 2008 18:37:44 +0000

I should have clarified that this is a great time to buy relative to the 2005-2007 period. I saw Centex homes drop their property price by 100K (20%) relative to last year in Beaverton. They were able to get last year’s buyers to honor their contracts by offering them the same price cut. You forget that interest rates are still
near an all-time low.

The way for sellers to move inventory in new developments now is to guarantee buyers (on paper) that if they drop the listing price for similar units under construction, then they will do the same for buyers who
bought it at a higher price.

By: Ron Ares

Ron Ares — Wed, 24 Sep 2008 04:52:20 +0000

Great comments all…thanks for chiming in. Sorry I haven’t been actively participating on the back end…

Bearlee and Uncle G beat me to the punch…I’m not too certain what NI’s point was…

Certainly, there are big write-downs on individual properties, but it isn’t across the board yet. Inventory pressure and distressed sellers will continue to accelerate declines. Stubborn sellers will need to go away for awhile, because no one is going to pay 2007 prices for your home with all the uncertainty lingering.

By: uncle_git

uncle_git — Tue, 23 Sep 2008 16:20:54 +0000

This is about the worst time in history to be buying.

Prices are still massively inflated and credit is continuing to tighten driving more buyers to the sidelines *at these pricing levels*.

Next year is going to be the year we follow California into the weeds. I can’t see a single economic indicator that tells me this is getting anything but worse in the coming few years.

This is the standoff that happened in every market – with buyers unable to pay the bubble level pricing and sellers “Not going to give it away”

Pretty soon San Diego will be cheaper than Portland – what does that tell you ?

By: bearlee

bearlee — Tue, 23 Sep 2008 02:05:06 +0000

Whatever Ni, most sellers are too close to being upside down in their loans to lower their prices, especially after tacking on the 6% realtor fee. I am seeing houses purchased in the late 80’s for $30-50K and now are listed as short sales. Funny thing is, I think their listing prices are still too high, especially when it’s obvious the home equity loans weren’t used for updating/remodeling.

By: Ni

Ni — Mon, 22 Sep 2008 23:28:51 +0000

For buyers looking for deals, this is an amazing time.

By: scone

scone — Sun, 21 Sep 2008 15:24:42 +0000

Why is the PDX region still showing any appreciation, anywhere? Are we that far behind the curve, and still waiting for the hammer to fall? Dare I even hope that will we will come out of this with only a flesh wound?

Thanks for posting this, Ron. If not for you I would have no clue about my little boondocks, Columbia county).

By: bearlee

bearlee — Sat, 20 Sep 2008 15:30:36 +0000

Speaking of rentals, the Wyatt remains 50% vacant, the Ardea (aka 3720 Bond) is dark as can be, and the 2121 Belmont is mostly vacant. Think there might be some pressure on rent $$$? Oh, and the ASA/Lovejoy just south of the Wyatt will be move-in ready soon. Then there is the Alexan in SoWa. And what will happen to the Atwater Place (SoWa) that is only 30% sold?

It will be interesting to see how this plays out in the rental market which no doubt will affect home sales and pricing.

These are definitely interesting times.

By: Paul

Paul — Fri, 19 Sep 2008 20:23:19 +0000

DK – The rent to price relationship is very interesting now. The Fed has done some research on what these trends tell us. The recent run up in house prices has not been mirrored in rent increases, this tends to signal a slowing of house prices moving forward and a rapid rise in rents at the same time. A game of catchup of sorts.

A 20% increase in rents may be a sign that the housing market is trying to correct the ratio of price to rents. But as it is in real estate it is all local, so it can always be a special case.