Feb 2022 - WHAT ARE THE TRENDS FORECASTING FOR THE 2022 REAL ESTATE MARKET? - Portland, OR & more!
We can see that interest rates have slowly risen since August 2021 and are nearing 4%. The last time interest rates were this high was July 2019. Rising interest rates could signal that the market could slow a little, but given the limited Housing Inventory, it may not have a significant effect.
Zero of the twelve locations had over one month of housing inventory in January, but now in February, NW Portland has climbed over the one-month mark. And the month-on-month percentage change shows that five locations have an increase, with NW Portland having the highest at 31%. The remaining seven locations decrease, with Milwaukie having the highest at (47%). What's driving this activity? [The following slideshow contains all Housing Inventory graphs.]
When we look at the month-on-month Housing Demand percentage change, Ten of the twelve locations have increased, with North Portland having the smallest at 6% and Milwaukie the largest at 64%. And when we look at the month-on-month Housing Supply percentage change, Eight of the twelve locations have increased, with SE Portland having the smallest at 4% and Tigard the largest at 35%. So we can see a continuing trend of Housing Demand outpacing Housing Supply in most locations. Until Housing Supply can keep up with Housing Demand, we will continue seeing an aggressive market featuring low days-on-market and buyer bidding wars. [The following slideshow contains all Housing Demand and Housing Supply graphs.]
An aggressive market is highlighted by low days-on-market (DOM), and a DOM consistently less than 10 days is typically considered a seller's market. In January 2022, I had to alter the graph because the previous version maxed out at 15 days, and NE Portland, SE Portland, Gresham, and Lake Oswego had a DOM over 15 days. Well, that was short-lived because every location is back under 10 days in February. The aggressive market seen in 2021 seems to be back in play. While I expected to see days-on-market go down as we head into the better weather and busier market, I didn't expect to see it drop so quickly. And I definitely didn't expect double-digit decreases between January and February. The one positive in all of these double-digit declines is that the locations are the same ones that had the significant increases in January. Although I must admit, the only double-digit decrease I was expecting was Lake Oswego, as noted in last month's video. February 2022 DOM is the lowest by far since 2019. If this trend continues, 2022 could be the most aggressive year yet! [The following slideshow contains all Days-on-Market graphs.]
When we look at the year-on-year Median Sold Price percentage change, There's one decrease, one breakeven, four single-digit increases, and six double-digit increases. The double-digit appreciation causes concern, as double-digit annual appreciation is not sustainable. Not only can it exclude many people from homeownership, but it can also make upsizing difficult for homeowners who would like to stay in the same school district and downsizing too expensive for those who want less home but need to stay near amenities and their support circle. When we look at the sold price trend for the last three years, we can see the comparison of negative appreciation, single-digit appreciation, and double-digit appreciation. We can see that double-digit appreciation is still the most prevalent over the last three years. Let's hope this trend slows down to single-digit for the good of homeowners and prospective homeowners alike. [The following slideshow contains all Median Sold Price graphs.]
HOMES SOLD - The following slideshow contains all 36 Month Trend Graphs.
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