Is the housing market going to crash?

This is the number one question that I recive when working with both home buyers and home sellers in the Portland & Vancouver metro areas; and its understandable! With news outlets fueling this narrative, as well as folks seeing constant price drops on sites like Redfin, Trulia and Zillow, I can understand the hesitation. I work each and everyday, sometimes ten or more hours per day, deeply involved in the workings of the housing market in my service area. While I also see the same news and same notifications that you see, what I also see if the data behind the metro areas with regard to sale prices, pending days on market and sale fails. In a nutshell, this is what I'm seeing:

• Home prices are not falling -- well not really. I agree (and the data supports) that a lot of homes are undergoing price reductions. I attribute this to two things: Quality of the home and pricing as if we're still in the 2020-2021 market. Homes that are priced appropriately to the most recent comparable sales are still recieving multiple offers within days of being on the market and selling for over asking price.
• Interest rates are starting to normalize. Over the past two years mortgage interest rates have been historically low -- this accounting for the massive number of active buyers all looking at once. In 2019 the average mortgage interest rate for someone with good credit was 4.51%*. In 2021 the average interest rate for someone with good credit dipped down to 2.65%. This week I saw multiple pre-approvals locked in at 5%-5.25%. While still higher than a normal rate, much lower than last quarters 6%+ rate.
• Equity of home owners is at an all time high. The average homeowner holds about $100,000 or more in equity. This is the perfect insulation for a recession. Unlike in 2008, where homeowners had zero or negative equity, homeowners now have a ton of equity on average and this will help to prevent forclosures in the future (which result in massive price downs)

Overall, I think that we're currently experiancing a slow down and will likely continue like this for the next 10 months. Month by month the local markets are seeing more inventory (part of the issue with 2020-2021) and sellers are more keen to invite an offer.

If you have further questions or would like to bring new statistics to my attention, feel free to email me at Taylor@stayrealtygroup.com

Is the housing market cooling off?

In the beginning of July, I started noticing something that was almost unthinkable after almost two years - the housing market was starting to level out. This shift, or change, is resulting in homes staying on the market longer, recieving less offers and selling for closer to list price (or less than). At first, I thought this had to be a blip, so I started to network with fellow agents, chat about this change and the feedback I gathered further solidified my thoughts. Here's what I learened:

• The housing market isn't dropping out. Homes arent being sold for less money than they were a year ago or even two years ago. The homes that are on the market are being traded (bought and sold) for market value, as opposed to well above what they're actually worth. This plateau is likely a result of folks ability to vacaction, and a long bout of buyer fatigue coming to fruition. This, combined with more invenotry coming to the market as sellers become more comfortable with strangers coming in and out of their house has yeilded great results for buyers over the past few weeks.
• More houses equals less competition for buyers, but more competition for sellers. Rewind 3 months, when inventory was at historic lows, home buyers were fighting each other for the same 7 homes availible on the market. If there are 20 buyers in a market, and an average of 4 buyers added each week, that means that after the 7 homes have accepted an offer, the following week will result in 17 total buyers still looking for their new home ( 20 buyers minus 7 going under contract leaves 13 buyers from the original pool still looking. Then add 4 additional buyers the following week and you're about where the previous week started). With more homes on the market, this is allowing buyers to have more options and less competition - the buyers are spreading out, more buyers are landing an accepted offer and the buyer pool is suddenly less packed.
• Home prices aren't dropping, however seller are having a tougher time overpricing their home. This isn't to say that homes arent recieving multiple offers anymore - they are! Great homes in desireable neighborhoods are selling at the same pace with just as many offers as they have been for the past 18 months. Homes that are precieved as average while priced as fantastic, are starting to sit around on market. I call this time a plateau.
• In my person buisness, many of my buying clients, especially those that are fed up with the constant offer and rejection are choosing to wait. They're enjoying the remainder of their summer, getting outside or traveling. This mass exodus outside is resulting in less weekly shoppers. In short, folks are tired and taking a break. This is making for a great opportunity for those that are still shopping to increase their liklihood of getting an offer accepted.
• The Portland Metro and SW Washington housing markets are the markets that I'm most versed in. These are the housing markets that I study daily and chart trends for. This area is right at a plateau point, and many economists project another traffi increase beginning in September. With September approaching, we're preparing for stiff competition to return coupled by the traditional slow down of new inventory that is generally seen September - December of each year.

What does this mean if I need to sell my home?

• If you need to sell your home in the Portland Metro or Vancouver metro areas, this means that you'll need to do a bit more to get it ready for market. This also means that strategic pricing is key to the success of your sale. If you're planning on selling it's important that you release the best home to the market at a competitive price. This strategy will increase the liklihood of multiple offers and a higher price for you. My average conversion for listed homes is 1 offer per ever 12 showings. This means that in order to recieve 3 competing offers, at least 36 showings need to occur. While the average days on market as a whole has increased, remaining competitive will yeild the best results. Paint the house, clean the carpets, fix things that are instant eye-sores to buyers.
• If you're in a position that requires you selling your home and buying a new one in the area, contingnet offers are no longer out of the question. More and more contingent offers are being accepted as the days on market increase and the number of offers on a single home decrease. The scary thought of "where will I go when my home sells?" is no longer carrying as much of a burden and is becoming a more feasible plan forward.
• Aligning yourself with a competent, well verse agent is critical to this success. Your agent should have history in the markets you're buying and selling in and a track record of success. Agents know agents and this reputation is important as the relationships we build carry weight regarding the success of closing. All sellers want that ability to trust that the home will close without hiccups. Working with a local, reputible agent helps to establish this trust.

More questions that aren't addressed? Leave a comment, send me an email or schedule a consult on my website. We'd love to be an asset to your home buying and selling journey. How can we be of service?

Does hiring a Realtor to sell your house make sense?

Often I get a question to my inbox, and that is “Does it make sense to hire a realtor if buyers are fighting over every house?”

In short, the answer is longer than just yes. Let me explain:

We all see that homes are selling quickly and getting bids higher than listing price, however this doesn’t happen due to the low inventory entirely. Yes, that is helpful and yes it is making things slightly easier in the way of getting showings and offers but where the real value comes in is leveraging these offers, marketing the home to the widest audience, and getting your home in tip top shape so that buyers zero in on your home being the perfect home for them! Do you know how to leverage these offers against each other? Encourage buyers to get ultra competitive with their terms? How does this impact your repair negotiation and are you aware of what is a routine request vs. a request that is unreasonable?

Lets unpack this!

Marketing is a word that is thrown around by folks very loosely. To many, marketing involves taking photos of your home, putting them on Zillow and waiting around by the phone for it to ring. If you’ve attempted or even succeeded in selling your home yourself, you know that at least 60% of these inbound calls are going to be coming from agents that don’t have buyers, and are simply hoping you’re too tired and will list your home with them. It’s an unfortunate reality of the real estate industry where, especially when there are less houses than there are agents in the state.

When I’m asked to market a home, my first step is an initial walk through - what can be done, if anything, to improve the home for as little money as possible? What changes will yielded the highest result? This initial walk through is crucial in developing the marketing plan. After changes are made, bringing in professional, high quality photographers, videographers and drone pilots are the next steps.

I am an expert in the purchase and sale of real estate, not photography, videography, etc. My favorite phrase is “Stay in your lane” and this is no exception. I leverage my skills and delegate the areas that I’m not an expert in. This is not to say that an iPhone photo isn’t great for family vacation, or that perfect shot of your beautiful dinner, but it is to say that this camera isn’t equip to yield you the best results with your homes sale. Trust me, it makes sense to utilize the skill of a professional.

After photos, my marketing continues with a lot of networking. I share your home with all of the top industry professionals — these are the folks, like myself, that have ready and able buyers. Notice the last part — able! I do a lot of work vetting folks before they even step foot in your home. No time for tire kicking and just looking — we’re here to accomplish a goal and that goal is getting your home sold for as much money as possible.

Now, we’ve marketed your home, offers come in: what value does an agent bring past that?

The knowledge of negotiation and leveraging! Once the first offer comes in, it gives me a starting point to leverage more offers, and ultimately the best shot of creating a bidding war. This bidding war is what will lead to the highest purchase price for your home. Offers are complex contracts that are more than just page 1 where you’ll find the offer price and closing date. As you dig deeper, you’ll find that the real value is in the terms — Inspection waivers, appraisal waivers, closing cost credits, etc are all buried in the contract and you won't know where to find them unless you know how to look for them.

Lastly, how do we get your home to the closing table? The closing table is where everyone signs to make this an official transaction. This is where the buyer pays and the seller receives. My favorite day is closing day and the moment of elation when that bank account balance grows substantially. 90% of my work is done during offer acceptance to closing. This is where most for sale by owners fail — they’re simply not equip to navigate the transaction without fumbling, losing out or killing the deal all together. Having 15 offers is fantastic but means nothing if none of them come to term.

How can I help you achieve your goals? What do you look for in a real estate agent?

Let me know in the comments! I’d love to be of assistance!

How to buy a house in 2021

The housing market in the Portland Metro areas as well as in the Vancouver metro areas are tough ones right now. With little inventory and abundant buyers wanting to purchase a place to call home, this is driving record high sales across the pacific north west. This guide will help you be successful when purchasing your next home.

• Who you hire matters. Working with a local agent that is seasoned and knowledgable in the neighborhoods you’d like to move into is crucial when deciding to buy (or sell) a home. Many agents boast about working all over the state, and while that may be beneficial to their business, it’s not beneficial to meeting your needs, and ultimately, your goals. Hire someone that is available when you are, that works harder than anyone else and will see the job through from start to finish. Here are some questions to ask your next agent when interviewing them to ensure the fit is right:

  • What are your working hours? When can I expect to get ahold of you? What is your dedicated response time?

  • How do you best communicate with your clients? Do you prefer email, calls or texts (and does this method align with your preferred method)?

  • How have you helped others in this market and how have you achieved success while navigating these market conditions? New agents are going to be hungry for business. Ensuring that you, the client, are wanting the home more than your agent wants it for you (commission breath) is critical. Ultimately, your needs MUST come first in this relationship.

  • How do you approach the tough conversations? Are you a direct communicator and if not, what is your communication style?

  • How long have you been in the real estate industry? What are your biggest accomplishments and what are you currently working on to improve?

• Why are you purchasing (or selling) now? This is a question I always ask my clients as this helps me to best serve them. Without a big WHY, it’s tough to navigate the motivation behind buying or selling a home — especially in this market. If you want to move, I’ll tell you its probably not the best time to do so. If you NEED to move (school district, job relocation, neighborhood safety, etc) then it’s a great time to enter the market. Recognizing the needs vs wants of home buying and selling is very important and you should have this conversation openly with your agent.

• Hire an agent! When buying a home, agent representation is free to you. The buyers agent is paid by the seller to deliver a buyer to them, so having this expertise won’t cost you a dime. This expert insight will ensure that you’re purchasing a safe home and making a solid investment. Owning real estate is more than having a place to lay your head at night (though that’s a big part), it’s the first step toward acquiring generational wealth and improving your financial situation. Think of your home as your high yield savings account. This can be tapped into later down the road to improve the property, finance future purchases or just accumulate wealth. Your agent can analyze all of this info and help to ensure that you’re making a good investment in both yourself and your future.

  If you have more questions, need advice or simply have some insights, please reach out to me. I’d be happy to help in any area that I can. Please, feel free to utilize my website here to search for homes, schedule a meeting or continue to learn about buying and selling real estate in Portland, Vancouver, and surrounding areas. No job is too big or small, and I’d be honored to be your guide.