Clients and Friends,
2014 had a rough start but is ending the year more consistent, dependable, and prosperous than 2013. Yamhill County sales volume of all property types is 5-9% improved over this same time last year. The average price locally is up 24% which does not mean individual properties are up that much, but does means the marketplace as a whole is catching up with the recovery and becoming more balanced. Portland has not only caught-up already but is leveling off with average and median pricing almost at the level of the top of the market in 2007. Portland has recorded an average price increase of just 6.6% but that shows the health of that market.
On a recent appraisal, the appraiser showed Newberg’s appreciation rate of 2.5% over the past year. This feels right to me. Remember that Newberg is on the leading edge of Yamhill County so expect to see this throughout the county next year. I think almost everyone in the industry would prefer 3-5% per year appreciation at the most; that is a sustainable rate and keeps both sellers and buyers in-check from becoming tyrants in the marketplace. We also never want to see another housing depression like the one we are just now emerging from 8 years later. Crazy run-ups lead to devastating falls!
The links include the following reports for the local real estate marketplace in September:
Market Action Report for September (Portland Metro markets including Yamhill County)
Yamhill County Home Sales Reports for (Sept)
Washington County Home Sales Report (Sept)
A few misc notes as we head toward the end of the year…
1. Lots and Land sales are moving again in our area! We have a great amount of inventory still and the prices are still low but we expect better and better this winter and next year. New construction is sputtering to gain traction but no complaints- it is happening and selling throughout the area. This is really the first noteworthy year for recovery in this sector in our areas.
2. Rural properties are still painfully disappointing. As is true with any recovery, the low price levels are the first to start moving and these are doing well, but over $500k is more than challenging. This dynamic ties in with luxury properties which are also weak. The farther from the urban centers you look, the more challenging the markets are.
3. I have told most of you that in my opinion, the worst months of the year for frustrations from our sellers are August and September. In August everyone in Oregon goes on vacation. In September the new year explodes with busy-ness and events at school, church, and in the communities. Anecdotally, these months lived up to that expectation this year, but I am glad to report that October is bursting with activity again. We expect a good winter sales cycle and while there are fewer buyers, they are all serious about purchasing now.
4. The interest rates have fallen very low again (ca 4% for 30 yr fixed)! This will help with winter sales. Of course this windfall is because of challenges in our economy so this is the proverbial double-edged sword. Bad economic news is good for the bond market (long-term debt which is what mortgages are). The economic news continues to be mixed, and a lot of it throughout the world is downright bad. Stability and predictability are necessary for prosperity for everyone. Remember interest rates can change daily so always check with a reputable mortgage broker.
5. Distressed sales are down to a manageable level (see image below). They are no longer usually having an impact on appraisals and market conditions. While the numbers are low, those of us who track the default lists know that there is still a sizeable inventory to hit the streets for a while yet. However, with increased sales taking place the effect is minimal (but not non-existent).
Thank you for your interest in our work and your loyalty to us throughout all the testing times we have endured. We are eager to get the job done for you and that is more realistic now. We are especially grateful for your referrals to friends, family, colleagues, and neighbors. Your endorsement of our professional competency and service is our reward.
Randy McCreith, Principal Broker
Cell: 503-310-9147 Fax: 866-281-6653
Bella Casa Real Estate Group