We keep hearing how the "Gloom and Doomers" are overstating the problems. After all, the pundits tell us, "All real estate is local," so not all markets are feeling the pain. There are still "bubble-proof" markets like Portland, Oregon:
NORTH PLAINS, Ore. - Here at the western edge of the Portland metro area, green fields flow into fir trees and foothills and eventually the Coast Range. They are a developer’s dream: flat, picturesque and a quick freeway spin from the region’s high-tech center.
If this were Phoenix or the San Francisco Bay area, real estate experts say, master-planned subdivisions would carpet these fields all the way to the mountains. Instead, their foot-high grass faces out on just one new, 15-lot cul-de-sac, buffered by strict growth controls that help North Plains maintain its rural feel and help shield Oregon from the housing crisis stunting the national economy.
While home prices fell by about 20 percent in the Sun Belt and the Midwest over the last year, values here in the northwest corner of Washington County rose 4.5 percent, according to local real estate statistics and a federal housing index. Prices overall in the Portland metro area dipped slightly; only Charlotte fared better among major cities.
When presidential hopeful Hillary Clinton tried to highlight housing woes in Oregon in May, the experts she assembled acknowledged that the market here has been holding up better than most. Analysts say Clinton and other politicians could learn from this state, where experts credit land-use restrictions and a late-blooming economy with keeping housing prices afloat.
For Portland, like the rest of the nation, high home prices make for tougher financing, and the effects of the economic slowdown are being felt all over. When you look at the statistics, things don’t seem quite so rosy. According to local real estate broker Charlie Phillips, this was the picture in April:
In the Greater Portland Metro area for the twelve months ending April 2008 the average sale price fell 3.9% to $325,000 v. $338,200 in April 2007. Our multiple listing service indicates this may be partly a result of a 51.2% decrease in the number of $1 million homes sold during the period (21 v. 43). April 2008 had 5.8% more new listings than April 2007 while Closed and Pending sales fell 35.1% and 34.6% respectively for the same period. At April’s rate of closed sales, the 20,248 Active residential listings would last about 10.3 months (if there were no additional listings for the period.). Average market time in the Portland Metro area in April was 75 days. By contrast, in April 2007 the selling time averaged 58 days.
Agents Charles and Jennifer Turner try to put a more positive spin on the situation:
The bottom of the slide is out there somewhere. It could be today, it could be years off. We’ll all be able to see where the bottom was because we can only see it through historical data. Everyone wants to buy at the bottom and sell at the top but that is not how markets work. Case-Schiller reports put Portland’s current values at 2006 levels. We didn’t hear too many sellers complaining back then. If you bought before 2004 and haven’t sucked the equity out of your property, you’re probably going to do okay when you sell. Not as good as you might have but still not bad.
But for the most telling story, I think the Portland Housing Blog tells the story best with this graph:
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