Portland Real Estate Market Update- February 2022

The Portland Metro area real estate market started off in February much like the past couple of Februarys only with less inventory.  New listings increased 11.4% over January, but as interest rates started to rise, there was a rush from buyers to get locked in on a purchase before rates went higher making it feel it feel as though there were very few listings to choose from and leaving inventory at 0.8 months for the second month in a row.  There has been much talk about a housing bubble and there are many reasons why experts don’t believe that is where was are headed (you can read more here) and although the average sales price has increased 10.5% from February of 2021 to February of 2022, the high demand for homes and impressive equity throughout the country, among other things, tells us that is not where we are headed.

If interest rates continue to rise, that will temper the demand some and home price appreciation may slow or stagnate, but the market can withstand a good amount of that and still be in a strong seller’s market.  In the last two years, the most inventory we’ve had is 2.4 months and historically 6 months of inventory is a balanced market, so we’ve got a long way to go in market corrections to reach a balanced market.  Our outlook for the spring market is that it will be a strong one with more inventory hitting the market and buyers still wanting to purchase and lock in a rate before anticipated additional interest rate hikes later this year.