2009 promises to be a very interesting year. We’ll have a new president, new predictions on where the market is going, and new lending rules to contend with or celebrate, depending on where the coin falls. In any market there are factors to consider when buying or selling and here are my tips on how to win in 2008.

Buyers:
1. Get a pre-approval for your loan. This will tell you what you can afford and how much you’ll need to put down. You can still use an FHA loan and only put 3.5% down. All loans are based on income and credit – the higher those both are the better the rate will be.
2. If you buy before summer you could get a tax credit loan up to $7,500. Depending on the loan amount this could equal almost 6 months of mortgage payments.
3. Buy what you can afford but don’t forget to look at tax benefits when comparing renting to owning.
4. Make an offer! If you find a home you love write an offer. You’ll never know what a seller is willing to accept unless you put it in writing.
5. Know the market. I will be updating my inventory report every month in 2009, you can check back with Sellpdx.com or subscribe to the RSS feed. Also, sign up for the listing email so you can see what is available and track your favorites with a favorites list.

Sellers:
1. Buyers know the market better than ever before, you should also sign up for the listing email so you can see what is available and track your competition in your neighborhood.
2. If you are moving up you should be talking with a lender about your next loan, you might not need to net as much as you think with rates at their current levels.
3. Make sure your home really shines before you go on the market. We all have a half finished to do list as homeowners and it’s always better to finish it before you go on the market than risk scaring a buyer away.
4. Price your home to be competitive. In any market the best deals go first. If you want to have the best odds you need make sure you’re in the game with pricing.
5. Be patient but aware of the market. Homes take longer to sell these days, know the average time on market and use that to judge whether you need to adjust price or hold tight.

Buyers and Sellers:
I think more than ever it is important to look at reasons other than profit to own a home. It is unlikely that you will buy and sell a home in a year or even two and make a profit in this market. That is why I stress the importance of buying a home you really love in an area you want to live. Real Estate has always been a long term investment and it’s only been in the last couple years that people thought of it as a get rich quick scheme. If you find a place you love and can afford, owning a home can be one of the most rewarding things you’ll do in life.

Popularity: 17% [?]

Here is your Year End 2008 update to inventories by zipcode. This shows which parts of town and which types of property are selling and which ones are sitting. Inventory is figured in months with 6 months being balanced, less than 6 months favoring sellers and more than 6 months favoring buyers. If I missed your area just let me know and I’ll add it in.

Trend: Detached homes close in are holding at a seller’s market level of inventory with many sellers waiting until Spring to list. Condo inventory continues to go up in many areas due to more constrictive lending rules and over building.

Highlights: 97227 – Overlook has only 1.7 months of inventory of detached homes.
97217 – Arbor Lodge, Kenton, Hayden Island has 7 YEARS of condo inventory.

Detached Homes:
97214 – 3 months Ladds / Colonial Heights / Hawthorne – This area also clearly favors sellers
97217 – 4.2 months Arbor Lodge / Kenton
97202 – 3.8 months Sellwood / Eastmoreland / Abernathy
97212 – 4.4 months Irvington / Grant Park
97203 – 5.6 months St. Johns
97211 – 4.8 months Concordia / Piedmont
97218 – 6.5 months East and West Cully
97227 – 1.7 months Overlook
97213 – 4.7 months Rose City Park
97206 – 5.2 months Foster/Powell / Brentwood
97232 – 4.4 months Kerns / Laurelhurst
97210 – 7.3 months Nob Hill / NW
97219 – 6.7 months Multnomah Village / SW
97201 – 12 months Downtown

Condos
97232 – 6 months
97201 – 9 months
97209 – 11.3 months The Pearl District
97211 – 22.4 months – Almost 2 years
97210 – 11.9 months
97206 – 12.9 months
97212 – 12 months
97214 – 13.8 months
97203 – 9.6 months
97219 – 7.8 months
97202 – 7.7 months
97217 – 84 months = 7 years

Popularity: 16% [?]

Well – In a word, YES.

We are in for a cold week here in Portland and it will definitely affected the number of people that are getting out there and looking at houses. We’ve also had a very small amount of new listings hit the market in December which means there really isn’t much class A inventory to look at right now. If you have a unique or nice close-in home you’d likely be pleasantly surprised by the speed of the market for good homes right now.

So back to the issue of what you can do about the weather:

1. LIGHT: In the winter it’s dark – add as much light as possible to your home. You can paint dark rooms with brighter and warmer colors. I recently installed new lights in my kitchen and it made a HUGE difference in the feel of the room at a very low cost. If your home is vacant make sure there are lights on timers for agents bringing people by after work in the dark. Please, please, please do not use flourescent lights, they give off an unpleasant light and in the winter they can take a long time to actually turn on.

2. WARMTH: Leave the heat on! It is a very good feeling to come in out of the cold… not out of the cold into a different cold. People will not spend time or think favorably about a cold house.

3. DOORMATS: I do not like having to take off my shoes to show a house. I recommend doormats at all outside doors both inside and outside. People are generally very considerate so don’t make them wear those little blue bootie things.

A couple little changes can make a big difference and that will help you sell your home faster. Now, come on everyone with very nice houses in close-in PDX – people want to buy your home but you have to get on the market first!

Popularity: 18% [?]

I was looking through my archive when I found this post from last year. I think it is just as appropriate this year so I’m going to re-post it with updates for this year in italics.

It’s that magical time of year where most people are planning for trips and telling their clients the market is slowing down. Historically December is the slowest month for pending sales here in Portland but this has never been the case for my business. December is always a sprint from start to finish for two big reasons; Investors and first time buyers. Same story this year

Here’s how it works: You have interest rates at the lowest point in years, a large inventory and people are ready to make deals. This is the perfect storm for qualified first time home buyers or investors. I wrote an offer on a home last week that had 8 other offers in the first week! I wrote one last month with 5 offers [ps- that's not slow!!!]. One of my listings has had 50 showings in the last two weeks!!! Nothing this busy this year but I did have one listing with 3 times the showings in December over October and November Take into account that rents are predicted to go up 10-15% this year and buying your own place or investing in a property that your renters’ are going to pay for looks like a great idea. Not sure where our rents are going this year but vacancy is at 3.5% and investors want better returns – that means higher rents.

There is also a tangible sense in the air that this Spring will see a turnaround in inventory taking us back to more of a sellers market and our couple months of buyers market will be gone. I can’t see the future but I’ve got a hunch. Spring did see a turnaround in 2008 and then we’ve stayed at 10 months of inventory basically all year. Some close in areas like Overlook and Ladds Addition and Colonial Heights have almost no inventory making it good for sellers but tough for buyers in those areas.

You might also notice that I’ve totally upgraded the new listings page with photo tours and links to the full listing info. I’m working on a way to incorporate narrated video tours for 2009. Thanks to all my readers here at sellpdx.com – I’m starting to meet some of you guys and I hope I get to help many more of you as you buy and sell in 2008. I’ve added Best Deal in Portland to highlight the very best the market has to offer and I’m looking forward to helping more people buy and sell here in Portland in 2009.

Popularity: 21% [?]

On the last tuesday of the month the Case Shiller index is released. This is the most widely used index on the health and direction of the national real estate market.
See the latest report Here.
What this shows is the resale of the same homes and whether it went up or down in value. The big problem is that right now most resales nationally are distressed properties which are as a matter of fact worth less than well maintained homes – in ANY market. The most important factor is never mentioned and that is this statistic: Percent change since the year 2000. Owning a home is a long term slow growth investment and the average home in Portland is worth 70% more today than it was in 2000. By comparison many stock market indices are worth less than they were in 2000.

This article from the SF Chronicle highlights the difference in value and price of REO or Bank owned properties which are generally on the lower end of pricing.

Popularity: 19% [?]