Post on 09-May-2015
description
9755 SW Barnes Rd. #560
Portland, OR 97225503-546-9955
Bob Broad 503-222-7623
Greg Long503-413-0027
www.PortlandRealEstateCafe.com
Team@PortlandRealEstateCafe.com
Real Estate in Perspective
Review of trends as we exit 2009
PortlandRealEstateCafe.com info@PortlandRealEstateCafe.com 503-222-7623
Become Informed. Act with Confidence.
The Numbers that Drive Real Estate
1. Home Sales
2. Home Prices
3. Inventory
4. Mortgage Rates
5. Affordability
PortlandRealEstateCafe.com info@PortlandRealEstateCafe.com 503-222-7623
Become Informed. Act with Confidence.
Sales increased 5% in 2009, the first annual sales gain since 2005 and the tenth highest annual activity level on record.
5.2
7.1
5.0 4.9
1989 1991 1993 1995 1997 1999 2001 2003 2005 2007 2009
2009 Was A “Top Ten” Year
Source: National Association of Realtors Millions of Homes Sold Each Year since 1989
PortlandRealEstateCafe.com info@PortlandRealEstateCafe.com 503-222-7623
Become Informed. Act with Confidence.
$198K$222K
$165K
0
50
100
150
200
250
1989 1991 1993 1995 1997 1999 2001 2003 2005 2007 2009
$174K
$203K
Returning to 4% Appreciation Rate
Historical appreciation rate is 4%
PortlandRealEstateCafe.com info@PortlandRealEstateCafe.com 503-222-7623
Become Informed. Act with Confidence.
If home prices actually grew by 4% every year from 1989 the median home price would be 17% above where we are today
Annual Appreciation Rate
Historical appreciation rate is 4%
PortlandRealEstateCafe.com info@PortlandRealEstateCafe.com 503-222-7623
Become Informed. Act with Confidence.
Stronger sales activity in the second half of the year helped draw down inventory of existing homes to 8.8 months in 2009
4.3
10.5
8.8
1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
Housing Inventory Peaked in 2008
Source: National Association of Realtors Measure is the number of months it would take to sell existing inventory at current sales rate
Bu
ye
rs M
ark
et
Se
lle
rs M
ark
et
PortlandRealEstateCafe.com info@PortlandRealEstateCafe.com 503-222-7623
Become Informed. Act with Confidence.
• Mortgage rates averaged 5.04% in 2009 which is an all-time low since Freddie Mac started tracking in 1971.
• Mortgage rate ranged from 4.81% to 5.59% in 2009.
• At the end of December, rates stood at 4.93%.
5%
10%
6%
4%
8%
12%
1989 1991 1993 1995 1997 1999 2001 2003 2005 2007 2009
Mortgage Rates at Historical Low
Source: Freddie Mac
PortlandRealEstateCafe.com info@PortlandRealEstateCafe.com 503-222-7623
Become Informed. Act with Confidence.
18.5%
15%
40 Year 40 Year AverageAverage
Source: National Association of Realtors Percent of a median family’s income required to make mortgage payment on a median-priced home
All-Time Affordability Record
PortlandRealEstateCafe.com info@PortlandRealEstateCafe.com 503-222-7623
Become Informed. Act with Confidence.
1. Foreclosures and short sales continued to skew home prices downward
2. Banks continued to tighten their lending standards
3. Stimulus aid continued to gain traction
4. The available sides per agent ticked back up
Events that Shape the Market
PortlandRealEstateCafe.com info@PortlandRealEstateCafe.com 503-222-7623
Become Informed. Act with Confidence.
• Four million foreclosure filings in 2009– One filing for every 45 housing unit (2.2%)
• So far, foreclosure prevention programs have had limited impact on slowing foreclosure rates.
Downward Pricing Pressure from Foreclosures and Short Sales
PortlandRealEstateCafe.com info@PortlandRealEstateCafe.com 503-222-7623
Become Informed. Act with Confidence.
49%
22%
26%
17%
64%
46%
30%
29%
0% 10% 20% 30% 40% 50% 60% 70% 80%
Q4
Q3
Q2
Q1Non-Traditional
Prime
Tightening of Credit Standards
Source: Federal Reserve. Percent of Banks Tightening their lending standards in each of the last four quarters. Many banks tightened more than once; virtually every bank tightened at least once. Non-Traditional includes adjustable rate mortgages with multiple payment options, interest only, Alt-A (limited income verification and mortgages secured by non-owner occupied properties)
• Jumbo Mortgage Originations Down 70 %• 6% of loans v 15% historical norm
• High-End homes (>$750K) only 2.3% of home sales• Down from 4.4%
PortlandRealEstateCafe.com info@PortlandRealEstateCafe.com 503-222-7623
Become Informed. Act with Confidence.
• Historically low interest rates and unprecedented home prices continually contributed to positive affordability conditions.
• The market share of first-time home buyers rose to 47% in 2009.
42% 40% 40% 40% 36% 39% 41% 47%
2001 2003 2004 2005 2006 2007 2008 2009
Percent of First-time Home Buyers
Source: National Association of Realtors
Stimulus Package Helping First-Time Homebuyers