Salem Oregon Real Estate Market Update- August 2026
Inventory is increasing quickly, and the possibility of interest rates way above 7%.
The Real Estate market continues to struggle for sellers as overall inventory is increasing exponentially and mortgage rates are hovering around that 7% mark. In fact, at the time of writing this email, MBS Dashboard shows rates crested over 7% today. All indicators point to increased challenges in our Real Estate market. This discouragement on the seller side should translate to a better opportunity for buyers, but we haven’t seen that convert in large quantities quite yet. There certainly are great buying opportunities, especially in the lower end of the market, but overall prices remain resilient despite the economic outlook. In January we had 3.99 months of inventory on the market. 8 months later we have 5.54 months of inventory. At this rate, we could see inventory crest around 6.5 months by year’s end. However, we typically see a slight reduction in inventory around the holidays. Many people dislike showing their homes around Thanksgiving and Christmas, so they pull them off the market and reassess their strategy after the holidays into early Spring. We expect this to happen this year as well. The mid term elections are also soon upon us, which usually makes things interesting. These changes can cause people to pause until they get a sense of which direction the state is heading. These certainly are interesting times upon us.
What we are seeing is the the bond market is struggling with prices decreasing since institutional investors and governments are not purchasing them as they did before. Many investors are seeing the gains in yields so we can expect mortgage rates to continue on their upward trend. Some buyers may want to get ahead of the increased pricing and purchase before rates go even higher!
Many buyers are watching the Federal Reserve and hoping that future rate cuts will immediately bring mortgage rates down. However, as we have discussed many times in the past, the Fed does not directly control mortgage rates. Mortgage rates are influenced much more by the bond market, particularly longer-term Treasury yields and mortgage-backed securities. Investors look at inflation, government borrowing, economic growth and the overall risk of holding long-term bonds. Right now, the bond market is facing some challenges. Longer-term Treasury yields remain elevated, and if investors continue to demand higher returns to hold long-term debt, mortgage rates could stay higher—even if the Federal Reserve lowers short-term interest rates.
In other words, a Fed rate cut can help market sentiment, but it does not guarantee lower mortgage rates. For mortgage rates to meaningfully decline, we will likely need to see stronger demand for bonds, lower longer-term Treasury yields and continued improvement in inflation. For buyers, this means it may be more important to watch the overall bond market than simply waiting for the next Fed announcement. Since the August jobs report came in higher than expected, most people are expecting the FED to keep rates the same; however the next CPI report may show inflation getting further out of hand, so the new FED chair may be faced with an increased dilemma as the president continues to push for lower rate cuts. The next CPI report comes out Friday September 11th.
Here’s a look at the latest Willamette Valley real estate market statistics and how we are trending in our Mid Valley.
MLS Statistics
| Market Indicator | August 2026 | Month over Month | Year over Year |
|---|---|---|---|
 Active Listings | 3,689 | ▲ 3.2% | ▲ 9.6% |
 Pending Listings | 973 | ▼ 8.8% | ▼ 8.3% |
 Sold Listings – All Properties | 729 | ▼ 2.7% | ▼ 8.5% |
 Sold Residential Properties | 560 | — Even | ▼ 3.4% |
 New Listings | 1,118 | ▼ 8.9% | ▲ 6.2% |
 Months of Inventory | 5.54 | ▲ 3.9% | ▲ 11.9% |
 List-to-Sold Ratio | 98.90% | ▲ 0.8% | ▲ 0.2% |
 Absorption Rate* | 20% | ▼ 4.8% | ▼ 16.7% |
 Average Residential Days on Market | 113 Days | ▲ 1.8% | ▲ 17.7% |
Home Prices
| **Price Indicator | August 2026 | Month over Month | Year over Year |
|---|---|---|---|
| Average Sales Price – All Categories | $492,000 | ▼ 0.4% | ▲ 5.8% |
| Median Residential Sales Price | $465,000 | ▲ 0.6% | ▲ 0.4% |
| Average Residential Sales Price | $521,000 | — Even | ▲ 1.8% |
Mortgage Rates
| ***Economic Indicator | August 2026 | Month over Month | Year over Year |
|---|---|---|---|
| 30-Year Fixed Mortgage Rate | 6.71% | ▲ 0.3% | ▲ 3.2% |
What the Numbers Are Telling Us
August continued to show a market with more inventory and more choices for buyers. Active listings climbed to 3,689, up 3.2% from July and 9.6% from August of last year. Months of inventory also increased to 5.54 months, nearly 12% higher than a year ago.
Buyer activity softened during the month. Pending sales declined 8.8% from July and 8.3% year over year, while total closed sales were down 8.5% compared with August 2025. At the same time, new listings were actually 6.2% higher than a year ago, which continues to add inventory to the market.
Home prices, however, remain remarkably stable. The median residential sales price was $465,000, up slightly from both last month and last year. The average sales price across all categories reached $492,000, approximately 5.8% higher than August 2025.
Homes are also taking longer to sell. Average residential days on market increased to 113 days, nearly 18% longer than a year ago. This reinforces the importance for sellers of accurate pricing, strong presentation and strategic marketing from the moment a property comes to market.
Despite the increase in inventory and longer marketing times, sellers are still receiving an average of 98.9% of list price, indicating that properly positioned homes continue to sell close to asking price.
Overall, the numbers point toward a more balanced and buyer-friendly market, while home values continue to show resilience.
*Absorption rate is based on current active listings compared with sold listings during the previous month.
**Residential statistics based on Willamette Valley Multiple Listing Statistics.
***Mortgage rate based on 30-year fixed mortgage statistics.
Some figures are rounded.
Have a wonderful start to your Fall and let us know if we can be of service to you!
September Monthly Market Real Estate Update
The markets are showing some more increased activity as mortgage rates are continuing to trend downward. The FED is meeting on September 17-18th!
All Real Estate is local. Here is a snapshot of our current local market and the trends to pay attention to.
| Current Active Listings (All Types) | 3055 | Up 1% from last month & up 17% from this time last year |
| Current Pending Listings | 1007 | Down 8% from last month & down 5.3% from this time last year |
| Sold Listings Last Month | 792 | Down 1.6% from last month & up 8.6% from this time last year |
| New Listings Last Month | 1085 | Down 9% from last month & down 3.4% from this time last year |
| Months of Inventory | 4.58 | Up 2% from last month & up 25% from this time last year |
| % List to Sold Ratio | 98.60% | Down .3% from last month & down .6% from this time last year |
| Absorption Rate *Based on current active listings vs sold listings for the past month | 26%* | Down 3% from last month & down 26% from this time last year |
| Average Sales Price in All Categories | $474,000 | Down .2% from last month & up .9% from this time last year |
| Median Residential Sales Price Average Residential Sales Price **Based on Willamette Valley Multiple Listing Statistics | $455,000** $504,162** | Up .6% from last month & up 2.9% from this time last year. Up .5% from last month & up 2.2% from this time last year |
| Average Owner Occupied Interest Rates ***Based on Freddiemac.com Statistics of 30 year fixed mortgage | 6.35%*** | Down 1.9% from last month & down 11.4% from this time last year |
| Consumer Price Index (CPI) **** All items-FED’s Goal is 2% | 2.5%**** | Down 14.8% from last month & down 39% from this time last year |
+Some numbers are roundedWe are enjoying some increased sales activity in our office as rates have decreased over the past few months. Home buyers are seeing opportunities that weren’t here before. Many sellers are working through the commission structure overhaul with ease and understanding the value of the extra layer of negotiations with buyers. Buyers are grasping it as well as they are negotiating those commissions. We have seen that inventory increased slightly in August, but slowed dramatically from the high increases over the past few months. Average sales price continues to increase as Days on Market has decreased as we are still seeing the nicer homes sell quicker as some continue to experience multiple offers if they are priced well. After choosing the right agent, pricing well is the most important decision for sellers at this time. There are over 3300 agents in our small Mid Valley area, where only about 800 have sold a handful or more and approximately 1500 agents have not sold one home this year. Many have only sold one or two. Experience Matters ~ Choose Wisely. We are entering into more of a balanced buyer/seller market at over 4 & 1/2 months of standing available inventory. We expect this to continue to increase, growing further into more of a balanced, but yet more of a buyer’s market.
We often communicate that our PEP Talk is the foundation for sellers to consider in selling their homes. Price, Exposure & Presentation. Pricing correctly is ‘paramount’ right now in a market like this. No one can tell you what your home is worth until the highest paying buyer is negotiated with. There are thousands of Automated Value Models (AVM) on the net, but they do not understand your location, curb appeal, condition, amenities, functionality, etc. We can help you focus on a range of higher probability selling through our pricing analysis. Going to market is the key to success. The exposure of your property is why you hire us to help you market your home to get the highest return. A highly advanced marketing plan covers all of the bases to gather the most views and buyer activity on a property. Presentation is so important as we hire the best stagers and photographers to showcase our listings to the highest ability, however the seller is in control of how well the home shows; and does it pass the ‘sniff test’?
Most of these items are out of our control, but in order to sell for the highest price in the shortest amount of time, these 3 foundational pillars are important to discuss.
We enjoy keeping an eye on average mortgage rates at Mortgage News Daily because they do a good job in trending the Treasury Yields, which have more of a direct correlation with mortgage rates. The FED influences short term rates, but the mortgage industry tends to make moves prior to the FED meetings to speculate positioning ahead of policy changes. The FED is expected to cut rates as the inflationary numbers that the FED uses to make policy are showing significant signs of slowing down. The August CPI report shows that inflation grew 2.5%, but the core (minus food and energy) grew at 3.2%. The FED’s goal is 2%, but not only to get to 2%, but they have communicated that they want to see an average of 2%. We are a long way from that; over a year at this pace.
We do appreciate some local lenders keeping us updated weekly on their mortgage rates, which appear to be lower than the national averages. Rates will depend on each buyer’s situation regarding the sales price, type of financing, income, debt to income ratios, credit scores, etc to determine the risk of the borrower. Using a good & local lender that has experience and communicates well is our advice.
What our Real Estate Brokers experience on a daily basis and how this affects you.
Experience Matters
With over 3400 brokers in our Mid Willamette valley, where everyone knows a Real Estate agent, why would it be important to choose your representation wisely? At Paramount Real Estate; we specialize in understanding contracts, are professional negotiators, and take special care of our clients interests. Here are just a few situations that we experienced which left people exposed and vulnerable.
Details matter.
We often do our due diligence in attempting to find out as much information as we can to represent our clients. It amazes us how often the other side willingly gives up confidential information that puts their clients in a negative negotiating position. It is our fiducial responsibility to represent our clients so any information that is not protected is presented for negotiation purposes. Unfortunately many buyers and sellers are not in great hands because of the work that their inexperienced or compromised agent says.
Experiences like this happen often. There are significant due diligence contingencies that protect a buyer’s earnest money. In order to terminate properly, certain steps need to be taken within the contingency periods. Some agents appear to be asleep at the wheel and miss their contingency deadlines to protect their clients. It is then up to our clients to decide what is best for them, however we have been in multiple situations where our clients have been awarded the buyer’s earnest money because they did not perform. It can be costly to be found in default.
We experienced a transaction where a seasoned buyers agent from another company used the wrong form to terminate a transaction for his buyer. A simple mistake like this put $10,000 of the buyers earnest money at risk as well as having to deal with litigation proceedings that dragged on. We often see buyers agents send over termination forms within contingency periods thinking they are representing their clients well. There are additional specific forms that need to be used depending on the contingency that accompany a termination agreement. Some brokers do not understand these details and leave their clients exposed because they do not use the correct forms.
One client of ours was buying a new townhome in the area from a big national builder. The wrong CC&Rs were recorded with many mistakes in it. The builder/developer used a template from another state for convenience. We fought to get those changed and updated CC&Rs recorded that protected our client before closing escrow.
During one transaction, we found that the seller had many judgments on record which seized the sale. We notified our buyer immediately so they could terminate within the contingency period and therefore protect their earnest money, as well as save them from spending money on further due diligence issues before realizing that we were faced with a dead end.
Years ago we represented a seller and found that the buyers were not going to be able to perform to close the transaction by the agreed upon closing date. The buyers agent failed to present an extension addendum to secure the transaction past the close date, and therefore the sellers were able to call the buyers in breach of contract. Our seller chose not to extend the closing, causing the buyer to lose their earnest money and the sale of the house. These deadlines are critical to meet and many brokers are not paying close enough attention in keeping their clients out of trouble. This can be especially true in an environment where a seller may be looking for a way out of the contract to be able to sell to a higher paying buyer, or one with more favorable terms.