Are Home Prices Falling?
If you have kept current with the news then you know that we are currently in the middle of a big SHIFT in the housing market. This is not only in Portland but nationwide as we see the FED increasing interest rates at a head-spinning pace in an effort to combat inflation.
As a Realtor, I was certainly aware that a shift in the market was happening back in March this year as interest rates squeaked up to the mid-3 % range, and as a Realtor out in the field I was starting to see fewer multiple offer situations but in May & in June when the FED raised the interest rates at such a steep increase, mortgage rates reacted by increasing over 2% in a 2 month period.
That increase has certainly impacted home buyers' ability to afford a home. What once was multiple offers sailing over the purchase prices has now slowed to no offers in the first week or two and longer days on market.
Let’s talk about home prices. And how has this affected prices here in the Portland area? Let’s be honest, at the rate we were going with prices, homes were quickly becoming unaffordable. Continued double-digit price appreciation would have surely put the market in bubble territory. Year-to-date home prices have already risen over 11%.
However, we are seeing a quick change in the market that is instantly affecting demand, which in turn affects pricing, days on market, and price appreciation.
As new listings linger on the market we are now seeing price drops on a regular basis all throughout the Portland metro area.
Market stats have shown that nearly 43% of homes on the market have had a price drop in Portland OR. This source stated that the uptick in price drops is symbolic of the slowdown in the housing market. Many buyers are backing off amid skyrocketing home prices, surging mortgage rates, high inflation, and a faltering stock market.
As a Real Estate agent with boots on the ground every day working in the market. I agree with the statement that the housing market is slowing and we should expect to see some price correction through the rest of the year. In the short term, this may mean some price drops for homeowners who are still wanting to price their homes at the top of the market.
As Redfin Chief Economist Daryl Fairweather says “There are two kinds of sellers in today’s market: Those who already know the market has cooled, and those who are learning about the cooling market as they go through the selling process,”
So, the answer you all came for… will we see home prices drop? Well, the experts say no! Although they do say that we will see a deceleration in-home price appreciation we should still year over year price growth.
I believe as the year progresses we continue to see changes in our housing market. Knowing that we are headed into a slower real estate market and other looming interest rate increases, I am encouraging my homeowners looking to sell, to do it quickly to capitalize on the massive home equity they have gained in the past two years.
If you want to know how the shifting real estate market will affect any of your upcoming real estate moves, please reach out to me. Consultations are always free!
You can reach out to me here, on my website, or send me an email at firstname.lastname@example.org
I look forward to hearing from you.