While most work activities were halted in April to reduce the spread of the coronavirus, people continued to buy and sell real estate.
In the Portland metro, prices are up compared to this time last year and the average number of days spent on the market before an offer was accepted have shrunk due to low inventory, according to the local listing service RMLS.
Sellers at almost all levels continue to profit from the low number of residential properties for sale in Oregon, the state with the largest housing shortage in the nation.
The number of new listings of Portland area homes in April — 2,847 — dropped 17.9% compared to the month before (3,468) and plunged 32.4% compared to April 2019 (4,210).
Contracts for home sales in April — 2,041 — saw a 13% decrease from March 2020 (2,347) and were 34.2% less than the 3,102 offers pending in April 2019, according to RMLS.
Closed sales (2,015) in April decreased 14.5% from the 2,356 transactions recorded in March 2020 and there was a 16.4% drop from the 2,409 closings in April 2019.
Despite the pandemic, stock market swings and a wide range of job and business losses, the shortage of homes for sale is helping to fuel higher prices and shorter times on the market.
The average time residential properties were for sale in April before receiving an acceptable offer was 44 days, a significant decrease from 61 days in March 2020.
Average sale price rose 5.6% — to $477,400 — in April compared to the month before.
The median sale price, the point in the middle in which half of the properties sell at a higher price and the other half at a lower price, held steady from March to April with a 0.2% decrease, but is up 3.9%, from $399,600 to $415,100, when comparing the first four months of 2020 to the same period in 2019.
The average sale price increased 4.3% to $465,200 in the first four months of 2020 compared to $445,900 during the same period last year.
"Well, amidst the shutdown we have managed to hit an all-time high for average sale price and median sale price," said Dustin Miller, a broker with Windermere Realty Trust. "We are still seeing some quick sales as well as multiple offers during this time."
The number of homes for sale has been dropping in the Portland area since January 2019, and even then, with a 3.3 month supply, it was a sellers' market. In April 2020, there as a 2.4 month supply of homes for sale, which was an increase from March 2020's 1.8-month supply.
Inventory is calculated by dividing the active residential listings at the end of the month by the number of closed sales and homes proposed and under construction.
"Finally the inventory level is picking back up closer to where it needs to be for a balanced market," says Miller. "Right now buyers have a mindset of getting a deal during this virus time before the market returns to normal and they lose out on some seller flexibility."
He adds that Northeast Portland and Beaverton homes are under contract on average in about 25 days. "That is a huge jump from their last month's numbers of 54 and 40 days on the market," he says.
Comparing the first four months of 2020 to the same period in 2019, new listings in the Portland area (11,950) decreased 10.1%, pending sales (8,835) decreased 10.4% and closed sales (8,160) increased 2.9%, according to RMLS.
Miller said an agent contacted him recently inquiring about a listing in the $850,000 range that was taken off the market last year without a sale.
Ilyse Ball, principal broker of the I Realty team, Remax Equity Group, advises sellers how to showcase their property before putting it on the market to increase appeal.
"Buyers are less willing to take on updates and repairs. They are walking away if they feel a home needs work," she says. "With prices rising over the past few years, people are getting picker, and with stay-at-home conditions, it may be daunting for buyers to think about workers in their home."
In this turbulent time, buyers who haven't lost their source of income and have acceptable debt-to-income ratios are cashing in on mortgage rates in the historically low 3% range.
Mortgage rates are expected to remain low, motivating buyers and sellers.
Ball predicts there will be more transactions this summer, a time that is typically slow as people go on vacation.
"I believe that there will be a surge of listings starting at the end of the May," says Ball, who has been selling real estate in the Portland area for 15 years. "Stagers are already booked out."
