August Monthly Market Real Estate Update

The markets are showing some increased activities as mortgage rates are trending downward.  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)	3023	Up 6.7% from last month & up 20% from this time last year
Current Pending Listings	1099	Up .8% from last month & down 6.7% from this time last year
Sold Listings Last Month	805	Up 5.6% from last month & up 3% from this time last year
New Listings Last Month	1189	Up 6.7% from last month & up 5.9% from this time last year
Months of Inventory	4.49	Up 6.4% from last month & up 27% from this time last year
% List to Sold Ratio	98.90%	Up .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	27%*	Even from last month & down 17% from this time last year
Average Sales Price in All Categories	$475,000	Even from last month & up 5% from this time last year
Median Residential Sales Price Average Residential Sales Price **Based on Willamette Valley Multiple Listing Statistics	$452,000** $501,835**	Even from last month & up 2.7% from this time last year. Up .05% from last month & up 2.6% from this time last year
Average Owner Occupied Interest Rates ***Based on Freddiemac.com Statistics of 30 year fixed mortgage	6.47%***	Down 7% from last month & down 6.4% from this time last year
Consumer Price Index (CPI) **** All items-FED’s Goal is 2%	2.9%****	Down 3.4% from last month & down 13% from this time last year

+Some numbers are rounded

Mortgage rates are looking much better these days and have decreased significantly in the past 30 days alone!  This is causing more buyers to jump off the fence and entertain purchasing again.  That along with increased inventory is helping many people get back into the game.  We are currently at 4 1/2 months of inventory as more homes are coming on the market.  We are seeing at the front lines that more homes are being presented as “Coming Soon” or “Pre Listing”, which means that listing contracts have been signed, but the sellers are still planning to get in position to hit the market live.  We have a database of these opportunities, so we can help our clients prepare for more upcoming inventory.  As rates continue to decrease, we could easily see the market shift and head the other direction as more buyer competition enters the market.  Is now a good time to buy?  Give us a call.

This month is the start of the National Association of Realtors settlement agreement terms.  The industry is changing on August 17th.  Let us know if you would like a consultation to discuss these changes and how they might affect you in your Real Estate endeavors.  Here is more information on the situation.

We have been saying for quite some time that we have seen cracks in the economy starting to show, and it could be evident to the entire world now, that the US administration is acknowledging that the economy is not as healthy as has been portrayed.  It sounds like almost everyone is expecting the FED to lower rates up to 50 Basis Points in their September 17-18th meeting.  This will indirectly help mortgage rates as well, but more importantly will help alleviate short term debt service that affects so many American consumers. The less they have to pay for their consumer loans, the more they will have to put toward the solid investment of Real Estate and their home buying process.

The CPI report that came out on the 14th shows that inflation rose at a rate of .2% for the month and inflation rose at a 2.9% rate YOY, which is lower than expected.  The FED’s goal is 2% on average, so that will still take some time.  Things are trending in the right direction in this department, however it is important to note that housing is increasing at a higher rate than desired.  The recent report shows that shelter is at a rate of 5.1% YOY, which is still concerning depending on which side you are on.  Our low inventory has hedged against the lower demand in housing even as inventory has increased at a slower rate over the past 2 years.  However, we are seeing inventory increase at a higher level recently.  It will be interesting to see how those stats roll out over the next year.  Many new home builders are still cautious as we saw some of their products sitting stagnant for longer than desired periods over the last 18 months.  Activity has picked up since then and we are seeing builders and developers increase their activity, however it is nothing near what is needed.  The main factor for increased pricing is regulation from the state, cities and counties along with increased risk for builders and developers.  With this highly volatile market, it is difficult for them to project 6 months to a year in the future.  We need to encourage our leaders of our municipalities to lower costs and regulations and incentivize home ownership instead of rental units.  The efforts that have been made here locally encourage renters, but not homeowners.  We are in favor of homeownership for everyone.

The recent jobs report shows only 114,000 jobs created (sure to be revised downward soon) and the unemployment rate increasing to 4.3%.  BLS U1-U6 Chart. It is interesting to note that back in 1994 the employment rate data was changed in how it was calculated by BLS.  As the data indicates, we are trending in the wrong direction in the employment department.

Everything cycles.  It is inevitable as there are good times followed by bad times.  But there are always good times ahead.  As our country and local area grapples with its own concerns, we see so many opportunities out there and a bright future on the horizon.  There are so many things to be thankful for.  We hope that you and your family are doing well and enjoying this Summer.

We hope this information is useful.  We work hard to research and study our local market so we can be of high value to our clients.  If you know of anyone thinking of making a move, please send them this information and let us know if we can help.