Is Oregon in a Real Estate Bubble?

© Judy Ben Joud | Dreamstime Photos

Have you been wondering if we are in a housing "bubble" and will that bubble pop?  As home prices keep rising, it's a question that has been raised often. 

Here's a simplified look:  In the pre-2008 era, home prices were going up and up as more people got into the game and loans were being given out like candy.  Then towards the later part of 2008, when home prices started declining, those that needed to refinance to avoid the higher interest rates of their adjustable-rate mortgages, found they couldn't.  What came next was people starting to default on their loans. 

So are we in that same pre-2008 zone again and is another crash coming?  First let me say that I am not a mystic, not into parrot astrology, nor do I consult the spirit world.  I do not know what the future holds.  That being said, I think there are some differences between now and 2006.  First, lenders aren't giving out loans to anyone with a pulse.  Are there some loans types out there that are a bit risky, yes.  But are the majority of loans being given out sound?  I think they are doing a much better job now of keeping stronger lending practices then they were doing pre-2008.

The second different between then and now is the pre-2008 demand was due to the whole loans-being-given-out-like-candy thing.  Whereas now we have a huge demand because the supply simply isn't there.  Builders aren't keeping up with the pace that buyers are purchasing properties.  They are struggling to find buildable land that is profitable to build on.  Without enough new construction homes, buyers are left to spar over the resale homes.  Sellers just aren't jumping into the market fast enough to keep up with all the demand that's coming from home buyers who are chomping at the bit to buy! 

Another factor that makes some think that the real estate market is going to stay strong is the fact that the job market is super.  Unemployment in Oregon is at all time lows.  Then you've got the rental market.  Rents are skyrocketing, leading many renters to wonder why they should be paying their landlord's mortgage, when they could be paying their own.

As people keep moving to Oregon in droves (because it's amazing and who wouldn't want to live here), as long as interest rates stay at lower levels and until new construction can catch up, I think you'll continue to see this strong sellers market.

Inventory in Washington County is Ridiculously Low

One of the hardest things as a Realtor right now is getting buyers in to see homes before they go pending.  This is because as soon as a home comes up for sale, it's getting massive interest and has buyers putting in offers as quickly as they can.  It is not uncommon for homes to go pending within the first three or four days.  For buyers, this gets real frustrating, real fast.  For sellers, it's the dream!  Sellers are getting their homes sold fast and often times, above list price.

Washington County, as well as the rest of the Portland metro area, is crazy right now.  Take North Plains, there are only eight active listings for homes under $350,000 (the hottest price range).  Of those eight listings, four are resale homes and the other four are new construction.  In all of Hillsboro, there are only 17 detached homes for sale right now under $350,000.  Seventy percent of those homes have been put on the market in the last month, many within the last week.  That's how quick the market is moving. 

What does this tell you?  If you have been thinking about selling your home, now is the time!  There is very little competition and you have the potential to get multiple offers on your home.

Why NOW is the Right Time to Sell

Okay, the holidays are finally behind us.  We were so busy with holiday get-togethers, shopping and end of the year activities that December just flew by!  Now that 2016 is here, let's get our act in gear. 

Why should you think about selling?  Because there is nothing out there in the inventory!  Well, "nothing" is an overreach.  There are some homes out there, but they are flying off the shelves and are pending before you know it!  Right now in Washington and Columbia counties, the average months supply of listings is one month for anything under $500,000!  That is incredible!  It means that if no new homes came on the market we would be out of any homes under $500,000 in a month!  Crazy!

 

What we are seeing in the market is that buyers simply don't have enough homes to choose from.  Often times sellers that price their home at market value are having multiple offers submitted on their home.  A single buyer can put in anywhere from two to five or even more offers on different homes before they finally get one accepted.  Only one offer on a house can be accepted; so buyers are getting rejection after rejection when another buyer offers more. 

This leads to frustration and why is buyer frustration a good thing for sellers?  Because when a buyer keeps missing out on the "perfect" home, their next offer goes even more over asking price, because they don't want to miss out on yet another perfect home. 

To sellers, this means that offers received are going up.  If a buyer learns that there are already five offers on a home, if they want to submit an offer, they know that in order to win they are going to have to go much over asking price.

Simply put, now is the time to sell.  Get your act together for 2016 and you just might be able to capitalize on the crazy market that is the Portland area!

Yurts, School Buses, Treehouses, Oh My!!

One of my favorite things to do as a Realtor is previewing homes.  I love seeing different ways of living, unique floor plans, fantastic views and all the different types of character that homes can have.  The fun side of real estate is trying to picture life in all of these various types of homes, and boy do I have some fun ways of living to show you!

Yurts on Pinterest

Ever thought of living in a teepee (also spelled tipi or tepee)?  Probably, when you were young, but there are actually people who live in them as adults.  More popular than real life teepee living is living in a yurt!  A yurt is a round structure with a simple post and beam construction that is usually fairly easy to set up and take down.  They tend not to impact the environment much, are relatively inexpensive and can be constructed in places where it wouldn't be feasible to build a more typical home.  Pacific Yurts Inc. sells a 706 square foot yurt for $10,785.  That's about $15 per square foot! 

Skoolies on Pinterest

Probably when reading the title of this blog entry you did a double take on the words "school buses" - but sure enough, there are people that remodel school buses and turn them into living quarters!  They are called "Skoolies" and are becoming quite the conversation topic!  Even the Oregonian has written an article on them.  You can find everything on-line from how-to-plans to already completed Skoolies.  The price range to build a Skoolie runs from $10,000 to $30,000 and up.  I'd say these yellow buses certainly qualify as alternative living! 



Photo from Ladyinterior.com

Finally, if a yurt or a school bus doesn't inspire you, then maybe a tree house will.  Popular on TV are shows about tree house living.  If you've ever had a dream as a kid (or an adult) to live in a fancy tree house, I highly recommend checking your local listings to find Tree House Masters.  The cost to build a residence in a tree is about $65,000-$85,000.  Read more about a real life tree house experience.

Everyone should be able to find the home of their dreams.  For some people, that may be a home with a white picket fence in the suburbs, for others it may be a condo in the big city.  Don't be afraid to look for something a little different, maybe some land in the country where you can put up a yurt!  Find your home, wherever your dreams may take you!  

Rental Prices Going Up, Up, Up!

© Peter Gustafson | Dreamstime Stock Photos

Are you currently renting?  If you are, I'm sure you've noticed rental prices increasing.  If you've tried to find new housing to rent, you've likely had trouble finding places currently taking applications, let alone finding a vacancy in a decent place that you would actually like to live.

As of August 2015, average apartment rent within 10 miles of Portland was $1516.  According to Rentjungle.com, the average apartment rent over the last 6 months in Portland has increased by $198 (15%).  If you're like most people and are on a budget, that 15% increase can really cramp your style.  We've seen evictions coming left and right because landlords are realizing that they can get high rents for the same properties.

When we are talking about high rent prices and a shortage of available rentals, the obvious next step is to think about buying instead of renting.  If you're paying $1500 a month in rent, in one year you will have paid $18,000 towards your landlord's mortgage; in 5 years you will have paid $90,000!  If you've read my previous posts, you know that an average home's value doubles in about 18 years.  Instead of paying off your landlord's mortgage, you could be paying off your own. 

Get it out of your mindset that you need a huge amount of money saved up for a down payment.  There are lots of options out there, even options where you don't have to put anything down.  Now is the time to stop paying your landlord's mortgage and to start paying your own, building equity in your own future!

Want to read more about the rental crisis?
NAR Study
Portland Housing Bureau

Four Ways to Use Pinterest When Buying a Home

If you haven't gotten addicted to Pinterest yet, then I almost hate telling you about it, because you will spend so much time there!  What is it, you say?  It's ideas on home decorating, recipes, cute outfits, pictures of adorable puppies and it's one-stop shopping for ideas to get you focused on what you want in a home!  I'm going with the assumption that you understand how Pinterest works.  So if you don't, stop now and go create a Pinterest account and play around on it, then come back here and get reading!

 The first thing that you may not think of, is that you can search floor plans.  Even if you're not planning on building your own home, it's a great way to start thinking about how you want your house to flow.  Do you want the master on the main floor?  Do you like the living room, kitchen and nook to be an open design?  Floor plans give you ideas of what you do and do not want in your home.

 

 

Besides knowing how you want your home to flow, the next thing to think about are the finishes.  What type of countertops fit your style?  Are you carpet or hard wood floor kind of people?  Thinking off the types of finishes that you like will help you narrow down a house and Pinterest can help you decide (if you don't already know).  Just search flooring or countertops and you'll get tons of idea!  Check out the Brazilian floors in this kitchen.

Just because a house has a certain type of finish, you can always choose to do a little home improvement project and change it to a different style that you like more.  Old, outdated cabinets?  Give them a makeover!  Pinterest has great ideas for how to build the perfect backyard pergola, to how to remove wallpaper and even how to build the perfect built-in bookshelf! Just plug in the type of project you want to tackle and Pinterest will give you the tips and ideas.

Remember with Pinterest, it's a great way to share your ideas with friends and family.  Do you often take a friend with you shopping?  Why? Because we all get tunnel vision when trying on that outfit or picking out a sofa.  We need a trusted friend to tell when we're crazy and not to buy something!  This is no different.  When you pin ideas on Pinterest, your BFF can tell you if you're beyond your limits and really shouldn't try that Do-It-Yourself project.  Tell your friends that you want feedback and have them comment on the cabinets, floors or paint colors that you've pinned.  That way you'll know right away if you're a little too far off base.

Want to see how I use Pinterest?  Check out and follow my boards!
Real Estate
Best Backyards Ever
For the Home
Gardens

 

Wallpaper Making a Comeback

Could wallpaper really be making a comeback?  We've all either owned, visited or toured a home that had hideous wallpaper.  You know the home, the one when you walk into the foyer and the giant, dated, floral wallpaper is coming at you so hard that you want to turn around and run.  Yep, we've all been there.  It's scary.

First thought as a prospective home buyer is "Holy cow, how much blood, sweet and tears is it going to take to get that down?"  The question is, how many layers of wallpaper are underneath the one layer that you can see?  If you're thinking of tackling a wallpaper removal project, check out HGTV. 

Now if you're really adventurous, you might be thinking of actually putting up wallpaper.  Say what??!  I know, I know, it sounds crazy.  But really, could wallpaper look good?  The answer is yes!  If you get to check out the Street of Dreams in Lake Oswego this year, they do wallpaper right!  It had me wanting to run right out and pick out wallpaper for my house!  

If you're thinking of selling your home anytime in the near future, the trick is to find something that you like, but also something that buyers wouldn't run away screaming from.  Neutral colors, blacks, whites, greys, something that can stand the test of time when it comes to style.

Wallpaper really does have the ability to look good.  But this isn't a task to take lightly, because we all know how it can go wrong so quickly.  If you're thinking about adding some style to your bathroom or entryway, do your research and see if your home could end up looking like these multimillion dollar homes in the Street Of Dreams! 


For something a bit crazy:
Check out wallpaper you can color (I just can't get behind this idea).