I have put together this localized home inventory report to give context to the metro statistics that often make headlines. Real estate is a local affair and this report 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. I use current active and 6 months of sold data from the RMLS to create this report.

Trend: Detached homes close in are showing slight increases in inventory due to low sales volume in December, January and February. Condo inventory hasn’t changed much since January but it remains high due to more constrictive lending rules and over building.

Highlights: Ladds/Hawthorne, Overlook and Sellwood/Eastmoreland remain strong with lower inventory.
Gresham and Happy Valley are at 14.1 and 12 months respectively.

Detached Homes

PORTLAND
97214 – 5.0 months Ladds / Hawthorne
97217 – 6.0 months Arbor Lodge / Kenton
97202 – 4.9 months Sellwood / Eastmoreland
97212 – 5.5 months Irvington / Grant Park
97203 – 9.2 months St. Johns
97211 – 5.2 months Concordia / Piedmont
97218 – 9.5 months East and West Cully
97227 – 2.7 months Overlook
97213 – 4.9 months Rose City Park
97206 – 6.5 months Foster/Powell / Brentwood
97232 – 4.6 months Kerns / Laurelhurst
97210 – 10 months Nob Hill / NW
97219 – 8.9 months Multnomah Village / SW
97201 – 21 months Downtown
Gresham – 14.1 months
Happy Valley – 12 months
Beaverton – 8.6 months
Vancouver – 11 months

Condos

97232 – 7.2 months
97201 – 15.4 months
97209 – 19.4 months The Pearl District
97211 – 15.4 months
97210 – 11.1 months
97206 – 11.1 months
97212 – 27.6 months – Just over 2 years
97214 – 16 months
97203 – 15.4 months
97219 – 8.4 months
97202 – 11.1 months
97217 – 76.5 months = Just over 6 years

Popularity: 15% [?]

There is a new program for 2009 which could possibly make you $8,000 richer in the form of a tax credit [which you don't have to pay back].

1. Buy a home in 2009 [Before Dec 1st 2009]
2. Be a First time buyer [You can't have owned another primary residence in the last 3 years]
3. Don’t make more than $75,000 a year [more than this and you get less of the credit until if you make too much you get nothing]
4. Keep your home for 3 years [or you have to give the money back]

Read this for more details

Popularity: 16% [?]

Buying a bank owned property could save you money but it has it’s own risks and quirks to be aware of.

1. Condition: Many REO [real estate owned by a bank] properties are in pretty tough shape. They almost always have the water and heat turned off so don’t expect a warm fuzzy feeling when looking at an REO. These houses might also have fixtures and appliances missing so factor that in to what you’re willing to spend.

2. Disclosure: Banks are exempt from giving the buyer a property disclosure. Make sure you get a thourough inspection of the property.

3. Shorter inspections and higher costs: To inspect a home you need the water on and that cost is passed on to the buyer with most REOs.

4. Financing: Some banks offer financing deals on REOs but many don’t treat these any differently. If you are using an FHA loan make sure there aren’t broken windows or holes in walls – this will cause problems with an appraisal.

5. Look at everything: Just because it says REO doesn’t mean its the best deal – look at everything before making a decision. Start Looking Now

Popularity: 17% [?]

My fascination with numbers and localized inventories began last January when the metro area started off 2008 with 12.8 months of inventory. It was a huge headline, it was the most inventory recorded in almost the last 20 years. Then February and March brought that number down and it averaged 10 months until October when it started climbing again. What happened in October? The stock market crashed and took many investors out of the mix. The winter is when a lot of investors are making moves and that just didn’t happen in 2008.

November and December shot up to 15 and 14 months respectively and the number of transactions slowed considerably. Two more things worth noting are the fact that loans all of a sudden needed 45 days to close and Portland shut down for two weeks with ice and snow.

One new factor I am following and will be sharing every month is the transaction volume. Most simply put how many homes are actually selling. Transaction volume is important because price follows volume. In January of 2009 303 properties sold in Multnomah County – that’s down from 480 in January of 2008. Today the inventory for the metro area was released and it’s at 19.2 months. Here’s the scary part – last year February and March saw big increases in sales volume – This year February is on track to be the slowest month EVER with a pace that would put the total sales at 200 properties. That will drive prices down and inventory will shoot up even more with many people waiting until spring to list their homes.

The flip side is we are moving more and more to a true affordability and that will bring more buyers to the table.

Popularity: 18% [?]

I was recently asked to talk about foreclosures by local TV station KOIN 6. Thanks to Tim Joyce and the producers at KOIN for inviting me to help educate buyers about the pros and cons of REO or Bank Owned Properties.

Click here to watch part 2 of the interview.

Popularity: 23% [?]