The Portland Metro area recovered in earnest in 2013. The momentum from 2012 carried over, with the five key indicators on the M TrueView market reports trending strongly positive. Median and average prices for homes are very near their all time high values, and continuing in a robust upward direction.

One of the most optimistic signs is that the number of units sold is significantly higher this year, indicating healthy demand. If there is one area for concern, it is the limited number of homes for sale. We currently sit at the lowest point since we started tracking this number in 2005, and it is still trending down.

Comparing the 4th quarter of 2013 with previous years, we see the home prices pushing all-time highs and homes selling in a relatively quick 48 days on market. The one red marker is the supply of homes for sale, at all-time low. This is generally seen as positive for sellers, driving pricing recovery. However, with supply so constrained, it presents difficulty for buyers who are ready and willing, but cannot find their desired property. This has a potentially negative effect on sellers themselves, preventing some from listing for fear of not finding another home that will fit their needs.
Quick Take Away – Seller’s Market
Supply vs. Demand*

The historical supply and demand graph clearly shows the severely constrained supply relative to previous years. The second graph is absorption rate: simply the ratio of homes for sale versus homes actually sold. The sustained absorption rate of over 20% is driving appreciation.
Median & Average Prices*

The median price in green has reached historic highs as of the 4th quarter of 2013, driven by the increase in demand and constrained supply.
Conclusion: Pricing recovery has occurred throughout the metro area as a whole (some areas to historic highs while others still lag). The recent appreciation has been due to a simultaneous increase in buyers and decrease in number of sellers.
Sellers: The market conditions are in your favor.
Buyers: Buying can be more difficult. However, buying at the beginning of the cycle of market recovery provides strong upside potential.
Sell & Buy: Selling an existing home and buying another can be challenging, especially if you are staying in the same area. However, not all metro areas are moving at the same rate. High-yield opportunities exists for selling in one of the hot eastside neighborhoods and then buying in a westside neighborhood that is still lagging behind.
If you have any questions about the market in your area or are considering buying or selling, please feel free to reach out to me.
*Data compiled from Portland Metro Region as defined by HomeQuest map boundary. Individual property data source from RMLS and calculated by M Realty. Total units for year. Average monthly number. Monthly average for quarter indicated.