With the new year upon us, it’s easy to wonder what 2018 holds for the Portland Real Estate Market. Here is a fairly brief recap of 2017 and a quick forecast for Portland’s 2018 Real Estate Market:
In 2017, it was predicted that the Portland Market would cool down this year, house prices would continue to rise, and that the mortgage rates would rise along with them. What happened? The Portland Real Estate Market did cool down, house prices did continue to rise, though at a slower rate, and the feared mortgage rate rise never happened.
So what does this mean for 2018? Potentially more cooling, but not horribly. Higher home prices, but at a slower increase. Continued low mortgage rates, and a fair demand for single family homes. Here are a few of the supporting factors for this:
- It is being predicted that Portland’s population growth will slow to national averages, around 1% in total annual growth. Bend has actually replaced Portland as the fastest growing metro area in Oregon, which is interesting to say the least. Even with this occurrence, Portland will most likely still be above average in growth.
- Job Growth is expected to slow. The great news is that unemployment is really low, about 3.7%. The watchable part of this is that as we approach “full employment” in Portland, job growth slows.
- Mortgage rates are still low and it is looking like they will stay historically low!
- Our neighboring states are still stable in their real estate markets with higher prices and high population growth. The thought is that this, in turn, lends stability to the Portland market in that there will be people transferring here looking for lower house prices and cost of living.
- New Home Construction is slow. You may think you are reading that wrong, that you drive by new construction all the time. In 2017, Portland will have had less than half the new home construction it had in 2006, and this trend is looking to continue into 2018. Part of this slowing is due to lack of available land for new homes, and part is due to the amount of apartment complexes that are going up.
- Resale inventory will also potentially remain scarce.
- Uncertainty caused by tax reform, and global events.