Update on Your Real Estate: Portland Is Cooling Off (Part Five)
- 2 symptoms that housing in metro Portland/SW Washington is cooling off
- Do you own too much real estate?
Portland Real Estate Still Obeys the Laws of Gravity
What goes up might come down (especially in a sizzling market).
After 8 strong years of relentless price gains, the party is cooling off in the US. This is even more apparent in metro Portland/Clark County. Here are 2 data points:
Rents Are Dropping
According to Zillow, residential rents in the metro Portland, OR are down nearly -3% from a year ago. After being one of the hottest rental markets in the US (where rents were virtually flat), Portland might be suffering from a case of indigestion.
Listing prices are falling.
Zillow also observed that a greater share of Portland homes suffer from price cuts below listing prices. Nearly 1 out of 5 homes in the higher end are being discounted, a decent uptick from the last 2 years. Indeed, this is the highest rate of price discounting in nearly 6 years.
Do You Still Own Too Much Real Estate?
We have written in past blogs about how we got here. Why did the housing market expand so rapidly nationwide? Why has SW Washington and metro Portland skyrocketed so much? It has been a good ride for many owners of real estate over the last decade.
However, we also cautioned that certain people might benefit from diversifying their nest eggs beyond just real estate. Indeed, many Americans still own an exorbitant percentage of their personal net worth in real estate, an asset where liquidity can come and go.
Where do you stand? Is your financial health capable of holding up in a less robust housing market?
 Aaron Terrazas, “Rents Drop Year-Over-Year for the First Time Since 2012 (September 2018 Market Report)”, Zillow.com, October 18, 2018, on https://www.zillow.com/research/rents-drop-september-2018-21655/ accessed on October 22, 2018.
 Aaron Terrazas, “Price Cuts Becoming More Common, Especially at the High End,” Zillow.com, August 16, 2018, on https://www.zillow.com/research/high-end-price-cuts-21018/ accessed on October 22, 2018.