A significant decline in homebuyers combined with a large increase in home inventory is beginning to cool the Portland housing market. However, pending sales are increasing slightly while prices remain stable, indicating some market strength. Now is the time for sellers to put their homes on the market and conditions will be the most favorable for the remainder of the year. Over the next few weeks, market conditions are shifting in favor of buyers as new homes continue to come onto the market and competition continues to ease.
Let’s take a look at the numbers and statistics currently shaping the Portland, Oregon housing market.
Portland home buyer traffic is declining
After declining slightly in April, buyer traffic increased throughout May, but then dropped significantly toward the end of the month. On average, the number of buyers entering the market has increased throughout the year, following the normal seasonal pattern of the Portland housing market (highest production in the spring). As you can see in the RMLS graph below, traffic has decreased to levels similar to this time last year. As spring draws to a close, we expect to see a further decline in active buyers in the coming weeks and months.
We're constantly reviewing and analyzing real-time real estate data, and one of the most obvious metrics we use to gauge the temperature of the housing market is the number of buyer visits. We created the chart below to help clarify how these visits reflect the state of the market. As you can see by comparing the numbers above with the chart below, the first half of May saw a slight increase in buyer visits, indicating a booming market. By the end of the month, the number of active homebuyers had dropped significantly, indicating a lukewarm 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 continues to grow
The inventory of homes available in the Portland market has been increasing since March, a time when sellers in the area are typically more willing to put their homes on the market. Inventory tends to continue to increase through the late fall, which is clearly shown in the following graph from Fidelity over the past few years: The current level of increased inventory is creating a cooler market environment, as shown in the graph below, which shows the impact these numbers are having on the real estate market: The number of homes on the market is likely to continue to increase throughout the summer and into the fall season.
Inventory as of May 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)
Each year, spring is the most active time of the year for the local real estate market, with an influx of potential buyers resulting in increased competition and sellers benefiting. Now is still a good time to list your property to catch the eye of potential buyers who are still searching, but with inventory steadily increasing, it's important to act fast.
The number of homes that have declined in price remains constant
Percentage of properties that have decreased in price as of May 30, 2024. Chart provided by Fidelity National Title.
The percentage of homes on the market that have been reduced in price has remained largely unchanged in recent months, increasing less than 1% in May from 33% in April. This stability in prices indicates that buyers continue to compete for the moderate number of homes on the market. However, a recent decline in homebuyers and an increase in the inventory of homes for sale are contributing to cooler market conditions, forcing sellers to lower their prices and compete for a more limited number of buyers. Given these factors, we should see an increase in the percentage of homes that have been reduced in price in the near future.
The average price remains stable
Price per square foot as of May 30, 2024. Chart courtesy of Fidelity National Title.
We use price per square foot as the most accurate indicator of real estate prices, and it has remained steady with little fluctuation since early March. As the chart above shows, the average price in 2024 was higher than the previous year, but was significantly lower during the same period in 2022. With fewer buyer visits and a steadily increasing inventory of homes available for sale, the average price of homes on the market may begin to fall in the coming weeks.
The number of new listings and pending sales both increased
As you can see from the RMLS chart above, the number of newly listed homes on the market was significantly higher from March to April than in both 2022 and 2023. Inventory is now up to a level halfway between the figures for the past two years: Because Portland's real estate market operates on seasonal cycles, you can expect home inventory to continue to increase through the summer and fall.
While the number of pending sales in April ultimately was slightly higher than 2023, it was significantly lower than April 2022. Home sales typically peak in the local housing market in the spring, and this year appears to be no exception. As summer approaches, we expect home sales to begin to taper off gradually over the next month or two.
High interest rates and inflation will negatively impact the overall real estate market performance in 2023 and continue to impact the Portland housing market in 2024. To get a better understanding of how these factors are impacting market outcomes, read our 2024 forecast.
When to sell your house
The annual spring sellers' market and favorable market conditions will soon be coming to an end. But if you're ready to put your home on the market, you can still take advantage of more active buyers and fewer homes for sale than for the rest of 2024. We encourage sellers to either put their home on the market now or wait for more favorable conditions in the spring of 2025.
Opportunities for homebuyers
As fewer buyers actively searching for homes and the inventory of homes available for sale steadily increases, market conditions will shift in homebuyers' favor over the coming months. Now is the perfect time to start looking for your dream home or next property and find great deals in Portland's desirable neighborhoods. We recommend PortlandHomesForSale.com, a home search platform with comprehensive search capabilities including customized filters (such as “biggest price drop in last 7 days”).
Choose an experienced real estate agent
As experienced real estate agents with over 20 years of experience in the Portland metropolitan area, we have insight into local housing market trends that can work to your advantage whether you're interested in buying or selling. Our team of top 1% buyers and sellers has the knowledge and experience to help you navigate the Portland housing market with ease. If you want to enjoy the best experience buying or selling a home, call us now at 503-714-1111 or chat with the bot on this site. We want to be a part of your success story.