The 2018 Portland housing market is set to continue to be tipped in favor of sellers. But we do expect a few changes in the coming year. We’re here to break down the trends we’ll see in this year’s housing market.
Portland’s economy is booming. In fact, the currently unemployment rate is just 3.7%, compared to the national unemployment rate of 4.1%. Because Portland’s unemployment rate is already so low (a condition called full employment), there likely will not be many more new jobs created here.
But according to John Mitchell, a local economist, Portland’s economy is in pretty good shape for 2018. Net worth and median family income are rising, and the tech sector is booming. Plus, there are the aforementioned record job numbers.
Portland’s population growth, which has been rising fast for the past decade, is finally seeing some slowing. It was 3%, and now the number is around 1%, which is much closer to the numbers in other big cities around the countries. The major reason for this slowdown is the aforementioned employment rate.
Home inventory continues to be short of the demand, and the 2018 Portland housing market will see more of the same. According to this article, there is enough housing to meet about half of the current demand.
Part of this is that people are opting to keep starter homes as rentals, which means there are fewer starter homes on the market for people to choose from.
A balanced housing market (meaning that it doesn’t favor either buyers or sellers) has about six months’ worth of inventory. The current Portland housing market has about two, even though demand has slowed down. There are still multiple offers on properties, but there aren’t as many as there used to be.
Given the lack of inventory in Portland proper, there are a lot of opportunities for buyers who don’t mind living on the outer edges of Portland.
Home values are expected to increase at a steady clip, though many predict that they will not be rising as quickly as before (most housing experts expect Portland home prices to rise between 4 and 5% this year). Zillow is currently predicting a number around 2.3%. It will be interesting to see what happens!
There was a lot of buzz about tax reform and how different iterations of it might affect the housing market. Now that it’s a done deal, here’s what we’re looking at.
First, state and property taxes are still deductible, but only up to $10,000. However, the standard deduction has also been doubled, which means that fewer people will be itemizing their tax deductions, anyway.
Both of these things will affect people’s paychecks and likely the local housing market, but we will have to wait to see exactly how. It’s also true that lowering the corporate tax rate will likely have a good effect on the stock market, which has an indirect effect on the housing market.
Home Energy Score Law
Starting in 2018, the city of Portland is requiring all homes to have a home energy score before they go on the market.
Home energy scores are not based on occupants or their energy usage. Rather, the score is based on a home’s physical characteristics—heating, cooling, lighting, water, and more. The assessment is performed by a licensed home energy inspector.
However, as long as it’s a seller’s market, this probably won’t have too much impact on how homes are bought and sold.
2018 Portland Housing Market
We hope this 2018 Portland housing market update helps you get an idea of what the year is going to be like around here! If there’s anything we can do to help with your home needs, please give us a call.