The Portland Metro has been a seller’s market for so long, we have forgotten how exciting and rewarding buying a home can be. Finally, though, buyers are starting to find their leverage with an increase in inventory of homes on the market up to 2.1 months, compared to 1.5 months the summer of 2016. The increase in inventory not only makes the buying experience more productive and enjoyable, but it should translate into an ease in rising home prices. Here are two more reasons why you should jump into the market now if you have been waiting for it to settle down.
First, home prices in our area are still solidly trending upward. Five years ago the median single family home sold for $279,000. Today, the median sales price is $411,000. That’s an increase of 9.5% per year. (In Seattle this summer the average home is selling for $740,000!). Market experts are predicting slower growth over the next few years, but even if the market cools to 2% or 3% annual increases it still makes sense to get into your next home now.
Why? Because interest rates are also trending upward. This week, Freddie Mac reports mortgage interest rates have now surpassed rates of 5 years ago. Less than a 1 point difference in rates can translate into a few hundred dollars on your monthly payment.
Rising home prices in the Portland Metro have been outpacing the increases in our salaries for some time. But now with more inventory for sale, the market is seeing a “correction” which is finally giving home buyers the upper-hand in most areas. You may want to take advantage of this sweet spot while interest rates are still under 5%!