June Real Estate Newsletter

‌‌‌‌‌‌It’s June, it’s summer in Oregon & it’s beautiful!  It’s what we wait for all winter for.  I hope you all are enjoying it.  Now on the latest from the Real Estate world. 

As I’ve gone over the last few months, the metro has 9 out of 10 homeowners with a mortgage less than 4%.  The existing home on the market are down 50% if what they were before the pandemic, and new construction is relatively flat (we did see a slight uptick in filings for new permits this month).  The Fed has been on a crusade to bring down inflation, they’ve paused for the moment, but it sounds like they’re going to give a couple of hikes before they stop.  So, the market is a bit flat with low inventory, but still more buyers than what we have inventory for.  This has been helping home values stay steady and or appreciate depending on the area.   

The interesting outlier that not many people are talking about is, student loan payments are set to be due again this fall.  Which is going to suck somewhere between 5-10 billion dollars a month out of the national economy.  I’d expect to see the results of this to start showing up in the data in Q1 & Q2 of next year and the full effect of the showing up in Q3 & Q4 with the result of pushing inflation down further & the Fed reversing course with a downward trend of interest rates.  So, there’s a sunrise on the far horizon if no other storm clouds roll through if you’re waiting for rates to drop, but I don’t have a crystal ball so take it with a grain of salt.   

In terms of where the market is, it’s a good time to sell, and a decent time to buy if you can stomach the current interest rates & use the refinance later strategy.   We’re still seeing inspections in the transactions which is a positive for the industry.  The process for fixing homes is quite different than new construction where an engineer or architect is the gate keepers of the building standards.  Most realtors rely on contractors to provide bids, and their knowledge on how to provide fixes for failures or flaws in a building that show up in the inspection report.  With the rare case being an engineer comes out if there’s something glaringly wrong.  So far, I’ve seen contractors way overbid fixes, bid for upgrades that aren’t required structurally, propose to fix things that are working correctly, and miss what’s of concern & wrong with the home. 

Real estate contractors have a bit of a captive audience, and generally things need to be done in a quick time frame, so the prices tend to be a lot higher than if it was outside a real estate transaction.  This is where I see sellers losing the most amount of money in a home sale, as the accepted offer price gets negotiated down with these high prices.  My value add to any transaction is my expertise & background in structural engineering and knowing how things are fixed correctly, what’s needed, what’s not, and what’s padding.  On the buyer’s side I’m great at making sure you’re buying a quality home, and on the seller’s side I have the knowledge to represent you through a transaction to keep more of your money in your pocket & keep the transaction fair.   I hope you all have a wonderful 4^th of July, stay safe out there!