Portland’s single-family real estate market is poised for another spring and summer of tight inventory and rising prices, agents say.

Portland has less than two months of inventory, and it’s only going to get tighter, said Kerri Hartnett, president of the Portland Metropolitan Association of Realtors and a Keller Williams agent.

“We’re pretty much in a seller’s market on steroids, if you will,” Hartnett said. “I kind of see that continuing. Every spring between April and July or August, that’s when the market really takes to tightening. I feel like it’s going to get tighter.”

Any further appreciation would exacerbate Portland’s already costly home prices.

In February, the median sales price for Portland-metro homes hit $353,400, up 12 percent from a year ago, according to RMLS, a real-estate listing service. That was also a 1 percent increase from January.

Hartnett said a lender she works with calculated that homes in close-in Portland are appreciating at a rate of $134 a day, or about $49,000 a year.

“Until our inventory does increase, we’re going to see appreciation for sure,” she said.

As the spring homebuying season commences, brokers are busy.

“I’m seeing heavy activity on buyers and we’re beginning to see some new listings,” said Edward Petrossian, president-elect of the Realtors’ association and a RE/MAX Equity Group broker.

Houses that sold in February spent an average of 62 days on the market.

“We still have multiple offers on listings, and buyers have to really work hard to get what they want,” Petrossian said.

Realtors are watching the state Legislature closely for changes that could affect them. House Bill 2006, for instance, would eliminate the mortgage interest deduction for second homes, and cap it for homebuyers with gross income of $200,000 for joint returns and $100,000 for single tax filings.

“That would affect us adversely,” Petrossian said.

Job growth in Portland can be expected to continue to support the housing market, but higher prices are beginning to make a dent in buying power, he said.

The post Portland-metro home prices continue to rise appeared first on Daily Journal of Commerce.

Employees of five area Keller Williams Realty offices joined the company’s worldwide campaign to “give where they live” Thursday through RED Day, “an international community service day,” according to a press release. RED stands for “renew, energize and donate.”

During the daylong event, Keller Williams agents helped local organizations including Trillium Family Services, Monika’s House, Community Warehouse, Innovative Services NW and three elementary schools in Beaverton.

The realty agents took the day off to, among other things, deliver books to classrooms at Chehalem, Fir Grove and Vose elementary schools. They also delivered furniture collected for Community Warehouse, and contributed to efforts to paint and organize.

“Keller Williams Realty is a company that gives back – to our associates and to our communities,” said Linda Alexander, founder and former CEO of Keller Williams Portland Premiere.

“Here, there’s a culture and alignment around our actions that I think is rare,” she said. “We have a lot of fun working together. We build each other up and we love what we do.”

The post Keller Williams employees help paint the town RED appeared first on Daily Journal of Commerce.

Two local real estate professionals this week released their reports on the state of the commercial and residential markets in 2014 and made some predictions for 2015.

“2014 was the second year of recovery hitting full stride,” according to Nick Krautter, a principal broker with Keller Williams Realty. He analyzed data compiled by Regional Multiple Listing Service on single-family home transactions.

Krautter determined that 2014 saw a 5 percent increase in the number of new home listings, a 3.6 percent increase in the number of closed sales, a 7.2 percent average price increase and an 11 percent inventory decrease.

“The Portland-metro area home prices are up 9.5 percent year over year,” he said. “Oregon also took the number one spot for in-migration, which is part of what is keeping home inventory at a very low three months, on average.”

In-migration is also keeping apartment vacancy low (around 3 percent), Krautter said. This sentiment was echoed by Portland-area appraiser Mark Barry, owner of Mark Barry & Associates, at a Wednesday forecast luncheon hosted by CCIM.

“Homeownership rates in 2013 were at 65 percent, and in 2014 that rate dropped to 64 percent,” Barry said. “So if you’re an apartment (building) owner, that number is going in the right direction.”

Barry said he’s often asked where the next up-and-coming neighborhood in Portland will be.

“There’s a lot going in the Mount Tabor, Powellhurst and Lents areas,” he said. “It’s also just a hop, skip and jump to Milwaukie and I think we’ll see some movement down there as the area gets more synergy.”

The post Metro-area real estate markets still on the rise appeared first on Daily Journal of Commerce.

The Portland-metro area wrapped up 2014 with the best December for single-family home sale closings since 2005, according to data from the Regional Multiple Listing Service.

RMLS reports there were 2,239 closings in the metro area in December 2014 – 25.6 percent more than in December 2013.

Within Portland city limits, 783 homes sold in December, compared to 685 in November, reported Nick Krautter, a principal broker for Keller Williams Realty.

“The market bumped up when it typically drops down,” he said.

Krautter predicts record-low inventories and interest rates will continue to increase prices and encourage sales activity in the first part of 2015.

“Inventory dropped to new lows in Portland this month,” he said. “This move signals continued appreciation and more robust activity than usual in the start of the year.”

In December 2012, the Portland-metro area had 6,352 active residential listings. By December 2013 that number decreased to 5,707 and in December 2014 it was down to 5,146.

RMLS reports Portland-metro single-family inventory in December dove to 2.3 percent from 3.2 percent in November. Average home prices for the area jumped 7.2 percent from $310,600 in 2013 to $333,000 in 2014.

The post Metro-area single-family home sales strong in December appeared first on Daily Journal of Commerce.

Home prices in Portland flattened out last month, but the stall likely is because of a seasonal lull rather than telltale movement in the market.

According to the most recent report from the Regional Multiple Listing Service, the average and median prices for Portland homes were essentially unchanged from October to November, at $273,800 and $233,900, respectively. Throughout the past year, however, home prices have climbed steadily and are 3.9 percent (average price) and 5.4 percent (median price) higher than they were a year ago.

Nick Krautter, a principal broker with Keller Williams Realty, said the average sales price drops every winter as people postpone listing higher-end homes until springtime. Meanwhile, lower-quality homes tend to sell in wintertime, which also contributes to a lower average sales price.

Krautter said he has been surprised at how much home prices have increased. He said that homes in some submarkets are selling for 10 to 20 percent more than comparable properties, with multiple offers. For instance, one home near Mount Tabor originally valued at between $275,000 and $300,000, had a pending sale for $360,000 within a month of going on the market.

“I really think right now that sellers are getting away with selling stuff, not above market value, but it seems a little bit inflated in some cases,” Krautter said. “That’s because there’s just not much to choose from and that’s the market at the moment.”

In November, the inventory of homes for sale was at 4.2 months. An inventory of six months typically represents a balanced market between buyers and sellers, while any smaller amount favors sellers. It’s not likely that the market will change course, because new listings were down 17.3 percent from a year ago, at 1,675.

Pending sales, at 1,730, decreased 20 percent from October, but increased 2.7 percent from a year ago. Closed sales, at 1,733, fell nearly 18 percent from October, but increased 13.9 percent from a year ago.

Overall, average home prices grew over the past year in all Portland submarkets except Gresham/Troutdale, which decreased 1.4 percent to $180,000. The rest were:

• Northeast Portland increased 6.1 percent to $288,100

• Southeast Portland increased 5.9 percent to $230,700

• West Portland increased 4.2 percent to $409,600

• North Portland increased 3.3 percent to $228,000

• Hillsboro/Forest Grove increased 3.7 percent to $216,000

• Beaverton/Aloha increased 3.1 percent to $218,900

• Yamhill County increased 3.1 percent to $210,300

• Milwaukie/Clackamas increased 3.1 percent to $248,200

• Oregon City/Canby increased 2.6 percent to $236,600

• Northwest Washington County increased 0.7 percent to $354,900

• Mount Hood increased 0.7 percent to $193,900

• Columbia County increased 0.7 percent to $163,100

• Lake Oswego/West Linn increased 0.6 percent to $428,200

• Tigard/Wilsonville increased 0.4 percent $284,000

The post Portland home prices flatten as winter takes hold appeared first on Daily Journal of Commerce.

Oil the chains and true-up the tires: Construction is under way in Northeast Portland on what will soon be the West Coast’s first indoor mountain bike park.

The Lumberyard will offer nearly 70,000 square feet of jumps, tracks, trails, ladders, bridges and other technical features for rain-weary riders.

Co-owner Will Heiberg said the park suits Portland for a couple reasons.

“I think the obvious one is our off-season,” Heiberg said. “We’ve got eight months of traditionally very dark, wet weather, which makes outdoor recreation a little more of a challenge.”

Heiberg, vice president of the Northwest Trail Alliance and a liaison for the International Mountain Bicycling Association, added that few outdoor cycling opportunities exist near the city – one of the most bike-centric in the U.S.

“If you’re looking for mountain biking activity, you’re really going to be driving an hour-plus to get to what I consider a decent trail system,” he said. “So if we can open up this opportunity in Portland, not only does it give you options when things aren’t perfect, but even when the weather is nice … I can still go out and get a workout in an hour and a half, work on skill sets, and work on my fitness when traditionally that would be the amount of time it would take me just to get to the trailhead.”

The Lumberyard will occupy the former AMF bowling alley building at 2700 N.E. 82nd Ave., across from Madison High School – approximately 1.6 miles from the Parkrose/Sumner Transit Center.

When complete, the park will offer about a quarter-mile of weaving and winding single track that will feed into areas of jumps, rollers and banked turns with varying degrees of difficulty.

The first phase of work is under way and includes interior demolition of the bowling alley and construction of the courses. The second phase involves construction of a new, 20,000-square-foot pole barn with a 30-foot ceiling that will cater to more airborne acrobatics.

Robert Sacks of A&R Development, the building’s landlord and owner, said the business is a smart real estate investment.

“First, we really liked the people involved, and a lot of our development is based on our feeling and research on their principals,” Sacks said. “Secondly, it’s a large, commercially zoned piece of property next to one of the largest, if not the largest, pieces of commercially zoned properties in the city.”

Sacks’ reference was to the former landfill site nearly adjacent to the Lumberyard, which he said could be prime real estate for a big-box retailer.

Sacks and his business partner, Dave Schrott – who is in charge of construction – purchased the property for approximately $1.18 million with the intent to lease it to Heiberg and his business partner, Michael Whitesel, an entrepreneur, Northwest Trail Alliance treasurer and former Portland State University business professor.

James Gillespie, with Keller Williams Realty, presented the business idea to A&R when it became evident that Heiberg and Whitesel would not be able to raise enough capital to start the business and purchase the property.

Together, the two raised $400,000 in initial funding. Whitesel estimated the project’s total value, including the property purchase, at approximately $3 million.
As the only indoor mountain bike facility west of the Mississippi River – the only other two in the U.S. are operated in Cleveland and Milwaukee by a company called Ray’s MTB – the project has come with challenges. For instance, Whitesel said they searched for property for the past year and a half.

“Finding the right building, in the right zoning, with the right usage has been … not a simple task,” he said.

Another issue has been navigation of building code requirements. For example, Sacks cited construction of the facility’s many bike ramps.

“The building code says that if you have ramps, you need handrails,” he said. “Well, that doesn’t really work in this situation … but we’ve been through this many times and anticipate the issues will be resolved.”

Whitesel noted that the course designer for the Cleveland and Milwaukee parks, Joe Prisel, was hired to help design their park.

In addition to the bike park, Heiberg and Whitesel plan to serve food, wine and beer at the Lumberyard. They haven’t decided yet whether to take that on themselves or bring in an external restaurant, but the idea is to make the business a community hub for bicycling enthusiasts and their families.

Heiberg said daily passes will cost roughly half the amount of a ski ticket – approximately $25 to $30 – and that season passes and special nighttime rates will be offered. The business partners hope to open the Lumberyard next spring, and Whitesel said they were planning to host a sneak preview cyclo-cross event to showcase the building sometime in February.

Whitesel said that if the business does well, they hope to expand into markets like Seattle, San Francisco or Los Angeles. And with roughly 200,000 mountain bikers in the Greater Portland area, he said they’re optimistic.

“If one percent of the mountain bikers in the Portland area show up once per month, that’s enough to break even,” he said.

The post Portland businessmen to build West Coast’s first indoor mountain bike park appeared first on Daily Journal of Commerce.

The Portland office of Keller Williams Realty, a residential real-estate company, today announced the firm will add a new wing to the firm, KW Commercial.

Keller Williams first launched KW Commercial in its base city, Austin, Texas, in 2008. It offers commercial brokerage services using the same techniques and business practices as the residential counterpart.

Nick Krautter, a principal broker at the Portland office of Keller Williams, will become the managing director of the new commercial division.

“I’m excited about this opportunity because we’re going to take the approach of Keller Williams and apply it to commercial real estate, which I believe has a lot of opportunity right now,” Krautter said.

The new wing is still hiring commercial brokers. KW Commercial has a 70/30 percentage split, which is different from most commercial real estate offices. This means the agent keeps 70 percent of commissions and gives the company 30 percent. The company’s cut is capped at $30,000 a year, meaning once the company recoups $30,000 the broker gets 100 percent of the commissions.

The post Keller Williams opens commercial branch appeared first on Daily Journal of Commerce.