Here’s how our Portland real estate market is positioned as we begin 2022.
2021 was a unique time for real estate in the U.S., and our Portland Metro market was no different. Today I’m sharing some stats that show where our market is positioned as 2022 begins.
In December, we hit a new record low for inventory at 0.6 months’ worth (our absorption rate), which means if no other houses came on the market, we would sell out of them within 18 to 20 days, in theory. We were hovering around the one-month inventory mark for most of the year, then we saw a year-over-year inventory decrease from October through December. Since we headed into the holiday season with a drastic decline in inventory on top of the low inventory we already had, we’re seeing huge demand from buyers waiting for inventory to hit the market. So we foresee 2022 having very strong buyer demand.
In the first week of January 2022, we saw interest rates rise higher than they’ve been during the entire pandemic. While that will affect some buyers, the current rates won’t curb the demand enough to retract prices and slow down the real estate market. The Federal Reserve has confirmed that we can expect rate jumps throughout this year as they try to rein in inflation.
The average appreciation we saw in Portland in 2021 was 15.8%. As we move forward through the year, we expect housing prices to once again climb, though we don’t predict double-digit growth like we saw last year. All this means that if you’re looking to take advantage of some of the lowest interest rates in history, you still have the opportunity, but it’s slowly creeping away from you. If you haven’t refinanced and plan to stay in your home for at least five years, you want to look into it.
If you’re hoping to buy or sell, now is the time to act. In 2018, we saw interest rates hit almost 5%, and the market responded instantly and slowed down immensely. I don’t expect that high of a spike this year, but interest rates are the Fed’s last-ditch effort to curb record-high inflation, which we all know is a pain in the pocketbook. I don’t know about you, but I’m tired of paying high gas and food prices.
Sellers: If you know you want to sell, you should do so this year. Low interest rates give buyers much more buying power and get you higher premiums for your sale. The first rate hike is coming in March, right as the spring market is upon us.
Give me a call or send an email if you want to strategize about getting on the market this year or have any questions. Also, if you’re looking to both buy and sell, we should have a conversation about how to go about that. We value our relationships and our ability to be your real estate resource. Have an excellent 2022!