Mortgage Rates Drop Again - Lowest Almost Ever
The Portland metro area has never had so few homes first as of the end of 2020 and with mortgage rates now dipping to incredibly low rates, competition is fierce. There have been so many homebuyers competing in the Portland market that home prices have been pushing upwards for the last few months.
In November 2020, inventory fell to the lowest reported in the 30-year history of the multiple listing service. The average sale price reached $521,000, a nearly 13% increase over the previous November. There were about 2238 Portland-area homes on the market in November, a nearly 40% decrease from October 2019.
This means with the absorption rate, it would take just one month to sell all the homes currently on the market. This leaves home buyers with a unique dilemma. By now and take advantage of the low-interest rates or choose not to risk the strict competition. However, if you are a renter, now would be the prime time to purchase a home but you need the right real estate agent in order to compete in today's competitive markets.
Compared to the previous year, the median cost to buy a Portland-area home jumps 6.5% to $435,000. And we are advising a lot of people that are considering a move to list now. According to a recent article in Oregon Live.com, real estate agents are advising clients to list while the inventory is still low rather than risking after the vaccine is made widely available. This might affect rates as things definitely change in the dynamic climate of our housing market.
In November 2020, 109 houses and condominiums sold for $1 million and 15 of those sold for over $2 million. While in these numbers can definitely skew the average sales price, the median is still is that halfway point where half of the properties above are higher priced and half the properties below are lower-priced
So what's causing the increase?
Most of us feel that first-time buyers working from home have found that they need more space than a simple studio loft or apartments. With the lowest mortgage rates in history, it offers more buying power to the buyer. Meaning that a 10% interest rates make a $500,000 home almost impossible to buy for the average home buyer whereas a 2.5% interest rate on a $500,000 home makes it much more affordable. Buyers are finding they can buy much more home, live outside the city, and have more space both on the lot and the square footage of the home.
Have you been considering a sale or purchase? You might be concerned that you have to sell to buy and will it all just wash out in the end? It really depends on the numbers, where you are selling, where you are buying, and your current credit history. The best thing to do would be to give us a call and talk to us about the possibilities and your options. If you are renting, now is the perfect time to get into the housing market. If you're planning on selling in the next year, I would suggest doing that before the middle of the year. If you're looking to buy or increase the size of your home, let's chat about your options and see which would work best for you.