To say 2020 was unexpected is an understatement — and the Portland metro real estate market certainly followed suit. The year was characterized by record-low interest rates, low inventory, and as a result, high rewards for both buyers and sellers.
The coronavirus pandemic, the wildfires that tore through the state, the economic downturn, and other events throughout the year may have presented us all with remarkable challenges. Yet, the real estate industry experienced incredible prosperity — and was a driving force for maintaining a sense of economic stability during this time.
Let’s take a look at this unique year in the Portland metro real estate market. We’re outlining some interesting statistics as well as a few overarching themes we recognized throughout 2020.
Low inventory has been a theme for Portland metro real estate for several years — and it’s something we didn’t think could possibly get any lower. But alas, 2020 was full of surprises!
According to the Regional Multiple Listing Service (RMLS), inventory for the area fell to the lowest numbers reported in its 30-year history in November 2020. There were just 2,238 Portland metro homes on the market in November, taking a 36.3% plunge from the 3,515 listed just the month before.
Low inventory had a major effect on home prices, as low supply created a high demand, resulting in intense bidding wars for buyers. As a result, median home prices shot up, topping off at an average sale price of $521,200 in November 2020, which is a 12.7% increase compared to the same month the previous year. In fact, Portland metro homes received between 99 and 102 percent of their asking price over the last year.
A few factors contributed to the low inventory. First, although it was a “seller’s market,” many sellers were hesitant to list their homes as they were nervous about finding another home in such a competitive market. Plus, new construction builders faced incredible challenges this year as necessary supplies, like lumber, drywall and plumbing, were on backorder due to the pandemic. Not to mention, the devastating wildfires that tore through the region reduced inventory for the state as a whole, as the wildfires destroyed more than 4,000 dwellings in Oregon.
Record-Low Interest Rates
Interest rates also reached impressive new lows in 2020, inspiring many to consider buying for the first time — and inspired others to buy another home or refinance their current home.
According to the Federal Home Loan Mortgage Corporation, also known as Freddie Mac, the year started with a national interest rate of 3.72% (30-Year FRM), began to quickly drop, then hit an intense upwards spike around the start of the pandemic, before steadily dropping to a record-low 2.67% (30-Year FRM) at the end of 2020.
2020 saw many first-time home buyers taking advantage of these record-low interest rates. Plus, many took the opportunity to buy a larger home they could now afford. And for those who refinanced, the money saved on monthly mortgage payments acts as a natural stimulus of sorts, as homeowners are now able to invest that saved money back into the local economy.
A Shift Towards the Suburbs
A lot of things shifted in 2020, including our very lifestyles and methods of working. Many suddenly found themselves working from home, homeschooling their kids, and doing pretty much everything at home — including dining, socializing on Zoom, working out and picking up new hobbies. This caused many to search for larger homes with space to spread out, which can typically be found in the suburbs surrounding Portland. And now that they were working from home, they no longer required proximity to downtown.
Upsizing + ADUs
This home is for sale here
Whether they were looking for a suburban home or a home closer to the city, many buyers looked to upgrade their square footage. After a year spent primarily at home, many were longing for a separate office space, an art studio, a homeschooling area or a larger yard for the kids. Square footage was a priority for many buyers this year and is expected to be in the near future! Additional Dwelling Units (or ADUs) have continued to be a hot commodity for homebuyers, who can use the separate space for an office, guest apartment or rental income.
If you’re among those looking for a spacious home, check out these recently listed homes in Oregon with lots of space in the form of square footage and acreage!
Luxury Home Sales
With all this talk of higher home sale prices, low interest rates, high demand, and a desire for square footage — you can only imagine that this translated to a successful year for luxury home sales. In 2020, Portland metro luxury homes were on the market for well under the average of 365 days. And they received an average of 92–99% of their asking price.
In this luxury space, it’s important to note that many are relocating to Portland from other more expensive cities (often due to the above-mentioned shifts caused by the pandemic). And the lower interest rate has created a larger pool for what now constitutes a “luxury buyer.” In these scenarios, cash is king.
A Successful Year for The Hasson Company
Now, let’s zoom in from the overall Portland metro real estate market to our personal success as a company. This was a historical and prosperous year for The Hasson Company, from our offices in and around Portland to our offices throughout the region, including Vancouver, Cannon Beach, Hood River and Bend.
Here are the final numbers for 2020!
For The Hasson Company:
Total Sales Volume: $2,193,988,335
Average Sales Volume Per Agent: $13,296,899
Total Number of Transaction Sides: 3,587
Average Transaction Sides Per Agent: 22
For Our Top 40 Producers:
Total Sales Volume: $1,229,667,800
Average Sales Volume Per Agent: $30,741,695
Total Number of Transaction Sides: 1,880
Average Transaction Sides Per Agent: 47
Our overall sales production for 2020 was at the highest level since the company was founded. The Hasson Company, for the first time ever, exceeded $2 billion in sales and saw our average agent productivity increase in both the number of transactions and total sales volume.
“I am confident that the results will further cement our leadership position both locally and nationally in average agent productivity,” Hasson CEO Steve Studley said.
The company’s success over the last year has a little to do with the conditions of the market and a whole lot to do with our brokers.
“This level of performance supports the saying you often hear from me, which is ‘the proof is in the people,’” Studley said. “Our brokers are truly the best. They repeatedly find ways to separate themselves by continually raising the bar, setting the gold standard with their professionalism, knowledge, work ethic, compassion, and understanding of the importance of a relationship–based business.”
Here’s to Another Successful Year!
As we enter 2021, we are expecting another successful year for real estate in the Portland metro.
If you would like to learn more about the market — including specific information related to your neighborhood — please don’t hesitate to reach out. We can connect you with a broker in your area who can walk you through the buying or selling process.
In the meantime, visit our Market Trends page for a breakdown of each Portland Metro neighborhood, which includes average sale price, days on market, etc.