As homebuyer traffic begins to taper off and available home inventory increases significantly, market conditions are shifting in favor of homebuyers. However, pending sales are up slightly and prices remain stable, giving sellers room to benefit from the lingering effects of the spring selling season. As homebuyer traffic decreases and new home inventory is expected to increase over the summer, conditions will become increasingly favorable for those interested in purchasing a home.
Below, we explore the individual factors currently shaping the Portland, Oregon housing market.
Portland home buyer traffic down
Over the past few months, buyer foot traffic has increased slightly but has since tapered off as the annual selling season draws to a close. Overall, homebuyer activity has increased throughout the year, as shown in the chart below from RMLS. Currently, buyer foot traffic is down 2.5% compared to mid-June, roughly the same level as the market was in June 2023. With the peak selling season for the local housing market now over, we should see a further decline in buyer foot traffic through the summer months.
We've been analyzing and interpreting housing market statistics for over 20 years, and one of the factors that most impacts market conditions is the number of buyers actively purchasing homes. Using the graph we created below, you can see how the current numbers are affecting real estate market conditions. Buyer traffic levels remained in the middling range in June. Conditions will continue to cool in the coming months as buyers continue to exit the market.
Oregon Weekly Home Buyers Hot or Cold Market? 0 – 5,000 Frozen 5,000 – 10,000 Cold 10,000 – 15,000 Cool 15,000 – 20,000 Lukewarm (Currently) 20,000 – 25,000 Warm 25,000 + Hot
Portland real estate inventory is on the rise
The number of homes on the market continues to grow, as the Portland market's peak selling season is expected to end in late spring. As the graph below shows, inventory of homes listed in the local real estate market follows a seasonal pattern, steadily increasing through the summer months and peaking in the fall. Inventory is currently at its highest level compared to the same time in recent years, contributing to an overall “cool-off” real estate market. I created the second graph below to show how inventory numbers affect housing market conditions, and as you can see, current inventory levels are rapidly approaching cooled market conditions. Inventory is expected to continue to increase through the fall.
Inventory as of June 30, 2024. The above chart is courtesy of Fidelity National Title.Portland Inventory RankingsHot or Cold Market?0 – 500 Active (April 2022 Notice)500 – 750 Hot750 – 1,000 Warm1,000 – 1,250 Lukewarm1,250 – 1,500 Cool (Currently)1,500 – 1,750 Cold1,750 – 2,000 + Frozen (October – December of last year)
As the peak spring selling season passes and we move into summer, there are fewer active home buyers competing for homes on the market. If you are considering purchasing a home, now is a good time to start your search as the number of new listings will continue to increase and prices will fall due to a lack of competition.
Discounted housing is on the rise
Percentage of properties that have decreased in price as of June 30, 2024. Chart provided by Fidelity National Title.
As we predicted last month, the number of homes on the market that were forced to reduce their prices after remaining fairly steady through the spring is starting to increase. A combination of fewer home buyers and a continuing increase in home inventory is causing sellers to begin lowering their prices to appeal to potential buyers. Currently, 43% of homes for sale are under price reduction. As you can see from the chart above, this percentage continues to increase through the end of the year, a consistent annual trend. This year is no exception, with July's price declines expected to continue to increase through December.
The average price remains stable
Price per square foot as of June 30, 2024. Chart courtesy of Fidelity National Title.
The average home price, calculated as price per square foot, has remained relatively constant since the beginning of March. As shown in the chart above, home prices remain higher than 2023 but slightly lower than the market price peak seen in 2022. Average prices are expected to fall in the near future as reduced competition due to fewer would-be buyers drives prices downward.
The number of new listings and properties up for sale increased in May
In May, the number of new home listings on the market continued to grow at a similar pace to the past two years. As in April, current housing inventory levels remain midway between 2022 and 2023 figures, as shown in the RMLS graph above. Due to the predictable seasonal nature of Portland's housing market, we expect the number of new listings to continue to increase throughout June and overall housing inventory to continue to grow throughout the remainder of the year.
Pending sales in May increased slightly in line with 2023 sales levels, but the full-year sales trajectory remains well below 2022. With the local housing market reaching its annual sales peak, sales are expected to begin to decline over the summer months.
High interest rates and inflation have impacted the Portland housing market in 2023, with both factors continuing to impact the real estate market's performance in 2024. Check out our 2024 forecast for more information on how these variables have impacted market conditions this year.
Advice for sellers
We always advise our clients that spring is the best time to sell a home in the Portland real estate market. As the peak selling season draws to a close, sellers still have a window of opportunity to put their home up for sale to interested buyers who are still searching for a new home. With the number of buyers gradually dwindling, the window of opportunity is small, so if you're not ready to sell right away, we recommend waiting for more favorable conditions next spring.
A win-win situation for home buyers
Fewer active homebuyers in the market and a steadily increasing home inventory create a favorable situation for buyers. Less competition for homes now and in the coming months means more affordability and more options. This is the perfect time to start looking for a new home and check out new property listings in your desired Portland neighborhood. We recommend utilizing PortlandHomesForSale.com for your home search, taking advantage of our unique search features and customized filters like “Biggest Price Drops in Last 7 Days.”
Experience is your friend
We have over 20 years of experience helping buyers and sellers in the Portland metropolitan area, so whether you're ready to buy or sell, you can trust our experts. Our team of highly qualified buyers or sellers is ready to assist you every step of the way. Call us now at 503-714-1111 or chat with the bot on this site to put our knowledge of the Portland real estate market to work for you. We'd love to have you as a part of our team.