Portland Metro Area Home Prices
The housing market is far less rational than even the often irrational stock market, for a couple of important reasons. First, most investors find it difficult to understand how housing supply responds to changes in demand. Only a small minority of people think carefully about such things. Second, it is very hard for the minority of smart-money investors who do understand such matters to bet against bubble-level prices in real estate markets. In housing, the smart money has relatively little voice. Robert Shiller, Sterling Professor of Economics at Yale University, in a New York Times article published in July 2015, explained why The Housing Market Still Isn’t Rational.
Portland’s a Terrific Value. Will it Last?
The Portland Business Journal and its sister papers nationwide collected local market pricing data on more than 40 products and services and published the results on October 16, 2015, in an article titled “Portland’s a terrific value, Will it last?” Below are some excerpts from the article.
“Portland has long had a cost advantage over Seattle and San Francisco. Most big-ticket items — from home prices to office leases to child care — are more affordable in Portland.
We ranked No. 78 out of the 106 markets studied for purchasing power, determined by using a market’s average salary, adjusted for cost of living. It would be easy to assume from that ranking that our purchasing power is relatively weak, but keep in mind that more than three quarters of the metro areas studied are considerably smaller than Portland, and therefore have lower costs of living.
A couple of high points: Portland ranked No. 23 for average pay, which is in line with our job market rank of No. 24; and our average five-year-growth rate in jobs (1.2 percent) and pay (1.9 percent) exceeded the averages for all 106 cities.
Portland’s affordability relative to larger cities likely contributed to that strong performance. Economic development agencies statewide have been using Portland’s affordability to aggressively recruit companies from high-dollar markets.
The strategy is working, particularly in the tech sector. California-based Google, SalesForce.com, Airbnb and eBay all have Portland outposts and collectively employ well over 1,000 workers. Startups like the targeted email provider Customer.io and rental management software maker Cozy have relocated their companies from New York and San Francisco, respectively, to take advantage of Portland’s lower costs and availablity of talent.
While Portland’s affordability and overall livability are fueling a robust economic expansion, the in-migration is creating tension. Housing prices and rents are both soaring, sidelining many prospective buyers and leaving renters vulnerable to being priced out of the market. Thirty percent of all home sales registered by the Regional Multiple Listing Service in Portland in 2014 were all cash, a trend driven by investors and deep-pocketed new arrivals from other West Coast cities. The reality is many low and middle-wage Portlanders can’t compete.
The good news is relief could be in sight.”
Monthly Newsletters to Track Portland Metro Area Home Prices
- Moving to Portland Monthly Newsletter Summary report of the Portland metro area housing market to include latest home prices, sales activity, mortgage information, weather data, and more. This summary extracts information from the detailed Regional Market Listing Service (RMLS) report for a quick read of the Portland metro area housing market. The newsletter is emailed to subscribers mid month.
- RMLS Report of the Five County Oregon Home Prices For those that want details about the five county (Oregon counties) Portland metro area home prices. Published by the Regional Market Listing Service (RMLS) monthly. You can download and save this report. Reports available from 2009 to present.
- RMLS Full Report of Oregon and Southwest Washington State Home Prices Detailed report about housing prices for all areas in Oregon and Southwest Washington (Clark County). Published by the Regional Market Listing Service (RMLS). You can download and save this report.
The above reports are usually posted by mid month. The RMLS reports are usually released and posted on the Moving to Portland homepage website between the 13-15th of each month.
September 2015 Home Prices
Real estate activity cooled slightly this September compared to August, but all numbers were ahead of the same measures in September 2014. Closed sales (3,010) were 26.6% ahead of the 2,378 closings recorded in September 2014, although the number slipped 2.8% from the 3,098 closings recorded last month in August 2015. It was the best September for closings in the region since 2005, when there were 3,291 closed sales recorded.
Pending sales (2,971) fared 16.5% better than September 2014 (2,551) but fell 11.2% short of the 3,347 offers accepted last month in August 2015. New listings (3,424) similarly improved 10.4% over September 2014 and slowed 11.8% from August 2015.
Inventory stayed stable at 1.9 months in September. Total market time increased to 46 days. There are currently a total of 5,657 active residential listings in the Portland metro area
September 2015 Median Home Price: $304,700
Prices continue to rise in 2015 compared to 2014. Comparing each year through September, the average sale price rose 5.9% from $333,000 to $352,500. In the same comparison, the median sale price rose 7.0% from $285,000 to $305,000.
Click on image to enlarge
September 2015: Sales Price Percent Change
- Average Sales Price Percent Change: +6.0% ($348,000 v. $328,400)
- Median Sales Price Percent Change: +6.6% ($300,000 v. $281,500)
Below are the sales price percent changes in September 2015 from their peak prices in 2007:
- Average Sales Price Percent Change from peak in August 2007: -5.0% ($349,000 v. $366,900)
- Median Sales Price Percent Change from peak in July 2007: +0.1% ($304,700 v. $302,000).
Above based on information from the RMLS™ Market Action report for September 2015.
June 2015: New Highs in Home Prices for the Portland Metro Area
The average sales price set a new high in June from the previous peak in August 2007 by $3,000. The new high is $369,500 whereas the August 2007 was $366,900. The median sales price jumped $18,000 from its peak in July 2007. The new high is $320,000 and the 2007 price was $302,000. But prices quickly returned to a more normal level after the summer home buying spurt as the median price was $304,700 and the average price was $349,000 for homes that sold in September 2015.
12014 Portland Metro Area Home Median Prices Up 7.2%
- New listings (37,654) were up 5.0%
- Pending sales (28,220) were up 4.3%
- Closed sales (27,752) were up 3.6% during the entirety of 2014 compared to the same time period in 2013.
Just 2.3 months’ worth of residential properties are for sale in the Portland area at normal rates of sales, according to December 2014 figures from the Regional Multiple Listings Service. That’s lower than at any time over at least the last eight years. The inventory often takes a seasonal dip in December.
The Average Sale Price Percent Change is based on a comparison of the rolling average sale price for the last 12 months (1/1/2014 – 12/31/2014) with 12 months before (1/1/2013 – 12/31/2013).
- Average Sale Price Percent Change: +7.2% ($333,000 v. $310,600)
- Median Sale Price Percent Change: +7.7% ($285,500 v. $265,000)
Below are the sales price percent changes in December 2014 from their peak prices in 2007:
- Average Sale Price Percent Change from peak in August 2007: -10% ($331,600 v. $366,900)
- Median Sale Price Percent Change from peak in July 2007: -4% ($290,000 v. $302,000).
1The Portland metro area figures above encompasses these five counties in Oregon: Clackamas, Columbia, Multnomah, Washington, and Yamhill. The Regional Market Listing Service (RMLS) report includes separate data for Southwest Washington Clark and Cowlitz counties.
2For details about the 2014 home prices in the Portland metro area you may want to view the December 2014 RMLS Market Action report.
City of Portland Prices 2011-2014
In West Portland (Includes Southwest and Northwest Portland and parts of eastern Washington County), the average price was $470,200 in 2014, $444,300 in 2013, $412,300 in 2012, $384,800 in 2011 and $410,200 in 2010. The average sales price change was 4.7% in 2014.
The three other areas in the city (North, Northeast, and Southeast) all showed increases in both average price and median price in 2014. Here are the numbers:
- North Portland – The average price was $291,300 and median price $278,000 in 2014. The average sales price percent change was 10% in 2014. The average price was $266,800 and the median price was $250,000 in 2013. In 2012 the average price was $229,000 and the median price $220,000. The average sales price percent change in 2013 was 16.2%, the third highest of any area.
- Northeast Portland – The average price was $348,800 and the median price was $306,000 in 2014. The average price was $326,700 and the median price was $282,000 in 2013 — the average sales price change was 13.5%. The average price was $288,000 and the median price was $250,000 in 2012 — the average price increased 8.0% over 2011. The average price was $266,900 and the median price was $229,000 in 2011 and that was a decrease of -5.8% from 2010.
- Southeast Portland – The average price was $303,900 and the median price was $260,000 — the average sales price change was 13.6% (highest of all areas in the Portland metro area). The average price was $269,900 and median price was $235,000 in 2013 — the average sales price change was 16.9%. The average price was $230,800 and the median price was $196,000 in 2012 — the average price increased 7.4% over 2011. The Average price was $214,700 and the median price was $181,500 in 2011 and that was a decrease of -9.7% from 2010.
Suburban Communities Prices
Many of the suburban communities saw double-digit average sales price percent change in 2014 — the highest was Hillsboro and Forest Grove with 11.1%.
In Lake Oswego and West Linn, the average price jumped from $428,500 to $529,600 in 2014. These two communities saw the price of an average home decreased from $482,100 in 2012 to $428,500 in 2013. In 2013 the average sales price change was 11.0% for these two communities. All the communities showed double digit percentage increases from 2012 — the largest average sales price change was 18.0% for Beaverton and Aloha. See the chart below for figures.
The Portland Business Journal Portland’s 27 fastest-selling neighborhoods of 2014 really should be the 27 fastest-selling zip codes. The Journal had this to say in one of their mid January 2014 publication, “In 2014 the average time it took to sell a home dropped 15.1 percent from 2013, the equivalent of 12 days less on the market. The 27,683 homes sold in Portland in 2014 took an average of 70 days to close. Portland’s thin housing inventory was likely the biggest reason for the accelerating sale rate.”
Here are the top five Portland-area neighborhoods (zip codes) that garnered the highest home sale prices in 2014:
- 97034 (Lake Oswego) – $675,836
- 97210 (Northwest District neighborhood in Portland) – $567,550
- 97212 (Irvington and Grant Park neighborhoods in Portland) – $547,745
- 97212 (Sylvan-Highlands and Bridlemile neighborhoods in Portland) – $529,157
- 97209 (Pearl and Old Town neighborhoods in Portland) – 97209
Portland Metro1 Residential2 Home Prices 2007-2014
Average Sales Price
Median Sales Price
1The metro area includes the following Oregon counties: Clackamas, Columbia, Multnomah, Washington, and Yamhill. It does not include Clark County in Washington state.
Source: Regional Market Listing Service (RMLS)
Communities Average Home Prices and Sales Price Change 2010-2014
2014 Average Price
City of Portland
West (Includes SW and NW Portland and NE Washington County)
Corbett, Gresham, Sandy, Troutdale
Clackamas, Milwaukie, Gladstone, Sunnyside
Canby, Beavercreek, Molalla, Mulino, Oregon City
Lake Oswego and West Linn
Northwest Washington County or Sauvie Island
Beaverton and Aloha
Tigard, Tualatin, Sherwood, Wilsonville
Hillsboro and Forest Grove
Mt.Hood: Brightwood, Government Camp, Rhododendron, Welches, Wemme, ZigZag
Outlying Oregon Counties
1The Portland metro area includes these Oregon counties: Clackamas, Columbia, Multnomah, Washington, & Yamhill. Note that it does not include Clark County (i.e., Vancouver, WA) in Washington state.
Source: Regional Market Listing Service (RMLS™)
Portland Monthly Magazine Annual Neighborhood Guide
The Portland Monthly magazine features neighborhoods in their April issue every year. It has tons of information about neighborhoods to include their pick of the best neighborhoods for the year.
To help those in the housing market, the magazine combines all the data from 120 neighborhoods and communities in the Portland metro area. Include in the story are housing prices, school ratings, demographics, crime statistics, parks, commuting information, and services. For the past three years, Portland Monthly has been cautiously optimistic about Portland’s metro area slow-simmering real estate market.
To visit the magazine’s website 2014 stories and numbers visit their Real Estate section — click on “Neighborhoods” to view the numbers for the Portland 90 plus neighborhoods and click on “Suburbs” for the numbers on 26 communities in the metro area.
Street Trees Increase Home Prices in Portland
In a paper published in Landscape and Urban Planning, Geoffrey Donovan of the U.S. Forest Service’s Pacific Northwest Research Station found that, on average, street trees add $8,870 to a home’s sales price and reduce its time on the market by 1.7 days.
Donovan and his co-author, David Butry of the National Institute of Standards and Technology in Maryland, reviewed data meticulously collected from 2,608 homes for sale in east Portland in the summer of 2007.
What they found was that if a house had street trees and tree canopy close by, that increased the sales price of a house and it sold faster. And that finding, they note, has some public policy implications. Calculating the increased property tax revenue to the city and comparing it to the expense the city bears maintaining street trees, the authors estimate street trees have a benefit to cost ratio of 2 to 1. “In Portland, the benefits of street trees significantly outweigh their maintenance costs,” they write.
Other Sources of Housing Information
Portland State University Quarterly Real Estate Report
The Portland State University (PSU) Center for Real Estate publishes the PSU Quarterly Real Estate Report each quarter. The first issue covered the last quarter of 2006. You can find copies of the report at: PSU Quarterly Real Estate Reports
The report is the product of a collaborative effort by the PSU Center for Real Estate and the Oregon Association of REALTORS® to provide service to the local community. The intention of the report is to provide useful information about trends in commercial and residential real estate to the real estate community in Oregon and Southwest Washington. It is very comprehensive and covers the local economy as well as housing.
The report is made possible thanks to a donation by the Oregon Association of Realtors® along with the participation of RMLS, Cushman & Wakefield, Norris Beggs & Simpson and Grubb & Ellis.
Since 1978, DataQuick has built a reputation as a provider of real estate information. Although much of DataQuick’s information is available only to its paid subscribers, some of the information at their Web site is accessible to all visitors. The site covers the California market extensively but it also releases quarterly information on the Portland housing market.
Urban Boundaries and Home Prices
The cost of housing is one of the most contentious issues related to Portland’s metro planning. With an median sales price over $300,000 in 2015, this is beyond the reach of many people.
Does the Urban Growth Boundary (UGB) cause Higher Home Prices? (see Portland Planning for a discussion of UGB). The National Association of Home Builders (NAHB) desire more land on which to build homes. In their document called The Truth About Regulatory Barriers to Housing Affordability the NAHB identified 42 markets with barriers, Portland being one of these markets. They called the UGB the “Wall of Portland” and attack it accordingly. The Home Builders Association of Metropolitan Portland, has been among those critical of Metro for being too restrictive in its UGB.
2000 Census Bureau figures indicates that the density in downtown Portland has increased by 30 percent, which is what planners had in mind. Only a few cities in the USA have increased their core city population.
Applying Science to the Debate Sightline Institute, an environmental organization located in Seattle, used some science to compare urban sprawl in Clark County in Washington State and Portland. Clark County is just across the Columbia River and part of the Portland metro area. Sightline used satellite imagery of open space, farmland and pavement, along with digital mapping of US Census data to track patterns of growth during the 1990s. They found that if Portland had taken the same approach to land-use planning as Clark County in the 1990s, an additional 14 square miles would have been developed. Click here to read the full report.
For a review of Washington State’s Growth Management Act, visit the 1000 Friends of Washington Web site.
Rating Portland’s Density
A study released in August 2003, called “Measuring the Health Effects of Sprawl,” commissioned by Smart Growth America, a national advocacy group, and financed by the Robert Wood Johnson Foundation, a health promotion group, found that U.S. adults who live in compact cities are more likely to walk or bike to work, school, stores and other everyday destinations than they are to drive. This translates to slightly lower weights and blood pressures.
As part of the study, researchers from Rutgers and Cornell universities used six variables, including housing density and block size, to create a “sprawl index” for 448 urban counties across the United States. The index was set with 100 as the average; more sprawling counties had lower scores.
New York’s boroughs had the least sprawl – especially Manhattan, with a score of 352. The most sprawling place was Geauga County, Ohio, near Cleveland, which scored 63.
Multnomah County (where the city of Portland is located), the Northwest’s most compact county, ranked 24th densest among the 448 urban counties, just missing the top 5 percent.
Groups with Different Positions on Housing Costs
Read the opinions of the Cascade Policy Institute, a Portland group that advocates a free-market approach.
1,000 Friends of Oregon feels that the Oregon regulations work well. 1000 Friends of Oregon is a nonprofit charitable organization, founded in 1975 by Governor Tom McCall and Henry Richmond as the citizens’ voice for land use planning that protects Oregon’s quality of life from the effects of growth.
Oregonians in Action (OIA) is a non-profit lobbying organization that leads the fight for land-use regulatory reform and protection for private property rights. OIA authored two ballot measures in 1998: one to require landowner notification and another to give citizens the right to petition for legislative review of “bad state regulations.” In 2004, OIA passed Measure 37, a constitutional amendment that requires compensation to landowners.
Compare Cost of Living Between Metro Areas
There are a number of free sites that allow you to compare living costs between metro areas but the numbers don’t always make sense. We recommend using the ACCRA Web site (the acronym means nothing it was created by a group of US Chamber of Commerce researchers years ago). It’s a member organization whose mission is strictly research. For under $20 you can compare the cost of living with where you’re living to five other USA/Canadian metro areas.
Office of Federal Housing Enterprise Oversight (OFHEO)
The Federal Housing Enterprises Financial Safety and Soundness Act of 1992 mandates that FHFA publish a House Price Index (HPI), a measure designed to capture changes in the value of single-family homes in the USA. It also includes a HPI in various regions of the country, individual states, and the District of Columbia. You can view the HPI by the state of Oregon and by the MSA (Metropolitan Statistical Area).
National Association of Realtors (NAR)
NAR is the “Voice for Real Estate.” It is America’s largest trade association, representing one million members, including NAR’s institutes, societies and councils, involved in all aspects of the residential and commercial real estate industries. Their “Existing Home Sales Data” measures the health of the residential real estate industry. Each month, statistics on sales of existing single family homes are reported for the national and four regional levels. Statistics on existing condo/co-ops are released quarterly, and figures on existing single-family home sales (detached and condo/co-ops) by state are released quarterly.
- The Community Development Network CDN is an association of nonprofit community development organizations in Multnomah County located in Portland, Oregon. Their Web site states that “CDN strives to strengthen nonprofit community development organizations and to provide a collective voice for healthy, diverse communities.”
- Home Ownership a Street at a Time (HOST) 3835 NE Hancock, Suite 101, Portland OR 97212. Phone 503-331-1752. Fax 503-961-9924. HOST is dedicated to providing affordable homeownership opportunities for low- to moderate-income families. HOST believes strong, healthy communities are created and sustained when homeowners have a stake in their neighborhoods.
- Housing Authority of Portland HAP is committed to providing safe, decent and affordable housing to individuals and families in Multnomah County, Oregon, who face income or other life challenges. HAP offers support through a wide variety of programs and services. HAP’s Web site is designed to educate citizens about these programs and services, and to share how HAP is working to build a stronger community.
- Oregon Housing and Community Services OHCS helps low and moderate-income families in Oregon buy their first home by providing below-market rate financing and cash assistance through its Residential Loan Program. The program’s below-market rate helps eligible families increase their home purchasing power and lowers their monthly house payments. Eligible borrowers will have two options to choose between – CashAdvantage Home Loan or RateAdvantage Home Loan.
- Portland Bureau of Housing & Community Development Their goal is “To make Portland a more livable city for all by bringing low-income people and community resources together.”
- Portland Housing Center The Portland Housing Center is certified by the U.S. Department of Housing and Urban Development as both a HUD Certified Counseling Agency and a HUD Certified Non-Profit Provider of Secondary Financing. It offers resources on how to buy a home.
- U.S. House and Urban Development – Oregon HUD’s mission is to increase homeownership, support community development and increase access to affordable housing free from discrimination.
- Washington County Department of Housing Services Extensive information for finding affordable homes in Washington County (west side of Portland).