2007 Portland Real Estate Review

Well, the verdict is out: Portland real estate market is officially a Buyer's Market. Though the first half of 2007 appeared to be strong, the second half clearly showed signs of decline. As of December 2007, the Portland real estate market has 8.5 months of inventory, despite a 7% increase in property value.

So, is the Portland real estate market still viable? As compared to the rest of the country where most are having negative growth, the answer is a definite YES. Why? Our market had always had moderate growth on an even keel, unlike other states where growth were in excess of 30% annually. The growth of the Portland market paces well with the increase in population and jobs. This made appreciation sustainable. As a result, Portland has one of the lowest foreclosure rates in the country in spite of the over heated market in the last few years. We're also one of the three cities where there's still positive growth.

Having said that, the 8.5 month of inventory as of the end of December is not something to sneeze about. Though the number is measured in the low season of real estate, that's significantly higher than 2006 same period. As a rule of thumb, when inventory piles up to exceed 6 months, that usually signifies a downturn.

We'll watch carefully the first quarter of 2008 to see if the actions from the Feds can adequately fence off a major downturn.