Two overlooked points:

1. Whereas the November to November numbers are strong, more impressive is the change from the low point. Portland home prices were 10.2% higher in November 2012 than eight months earlier in March 2012.
2. We have opined for some time to friends and clients that we thought the Portland market was excessively discounted. Put bluntly, houses were just too cheap. The recent appreciation is more of a “correction.” So is there more correction left? We think so. Assuming a historical growth rate in home prices of 4.0%*, Portland and U.S. home prices are still 15% below the long term trend line.

Many factors affect the housing market. We’ll review 2012 and forecast 2013 in the days ahead.

*Robert Shiller, co-creator of the CS Index, charted in Irrational Exuberance (titled after the famous term coined by former Fed Chairman Alan Greenspan) the growth of U.S. home prices since 1890 at a little under 4% per year. Other sources have supported that conclusion.

Portland’s Waterfront Park one of“America’s Great Public Spaces” – American Planning Association (October 2012)
“10 best beer cities in the world” – USA Today (Oct. 4, 2012)
Portland’s Pearl District named No. 5 “Best Hipster Neighborhood” – Forbes (Sept. 20, 2012)
“In Portland, Ore., bikes rule the road” – USA Today (Sept. 9, 2012)
One of the “10 Best Cities for Single Women” – Shape (August 2012)
Portland one of the “Top 50 Meeting Destinations in the U.S.” – Cvent (Aug. 9, 2012)
Portland called “America’s capital of cool” – Time Out Sydney (Aug. 6, 2012)
One of the country’s top 10 “Eating Towns” – Huffington Post (Aug.1, 2012)
“America’s Best Bike City: Portland, Oregon” – Bicycling magazine (May 2012)
No. 3, “Top 10 cycling destinations” – VirtualTourist.com/Reuters (May 11, 2012)
“Our Next Art Capital: Portland?” – Wall Street Journal (May 2, 2012)
No.2,America’s most-liked cities – Yahoo! News (April 20, 2012)
No. 2, “America’s Best Cities for Hipsters” – Travel + Leisure (April 2012)
No. 1,“America’s Greenest Cities” – Travel + Leisure (April 2012)
One of the “Top 10 cities for cycling” – Sherman’s Travel (March 2012)
No. 4, “Techiest city” – Travel + Leisure (January 2012)
One of “The five best places to live in the world” – The Guardian (Jan. 20, 2012)

Andy’s Tree Farm
14713 NW Old Germantown Rd.
Portland, OR 97231

Sauvie Island Farms
19818 NW Sauvie Island Rd.
Portland, OR 97231

Reichen Christmas Tree Farm
8450 NW 185th Ave.
Portland, OR 97231

C.W. Baggenstos Tree Farm
20200 NW Murphy Rd.
North Plains, OR 97133

Hagg’s Tree Farm
18265 SW McCormick Hill Rd.
Hillsboro, OR 97123

Helvetia Christmas Tree Farm
12814 NW Bishop Rd.
Hillsboro, OR 97124

Parry’s U Cut Tree Farm
45627 NW David Hill Rd.
Forest Grove, OR 97116

Oxbow Rim Tree Farm
34623 SE Homan Rd.
Gresham, OR 97080

Allen Tree Farm
19101 S Redland Rd.
Oregon City, OR 97045

Beck’s U Cut & Sheep Farm
16700 S Gerber Rd.
Oregon City, OR 97045

Victorhill Farm
14935 S Leland Rd.
Oregon City, OR 97004

Historic Kirchem Farm
19723 S Baker’s Ferry Rd.
Oregon City, OR 97045

St. Nick’s Christmas Tree Farm
16710 S Gerver Rd.
Oregon City, OR 97045

Sleighbells Farm & Gift
2385 SW 195th Pl.
Sherwood, OR 97140

Lee Farms
21975 SW 65th
Tualatin, OR 97062

Cedar Creek Tree Farm
17744 S Windy City Rd.
Mulino, OR 97042

As a recent article in The Oregonian highlights, the decrease in inventory and simultaneous increase in home sales over the past few months means that homes currently on the market are a hot commodity.

While there are fewer buyers this time of year, the buyers who are out looking tend to be more serious and often want or need to be in a home by the new year.

Here are a few tips for using the holiday season to your advantage if your selling your home:

It’s important to have your home easily available for showings, because this is one of the few times that families can actually look at homes together due to vacation time.

People love holiday decor, and it really helps potential buyers feel at home in your home. However, do not go overboard with Christmas decorations – too much clutter or personal touches can prevent buyers from envisioning themselves living in your home.

This time of year is also a great time to have open houses, what better excuse for holiday baking and a cozy fire?

It’s also important to keep walkways and driveways clear of leaves and ice.  The fewer obstacles and restrictions visitors face when looking at your home allows you the best chances of a quick sale!

Property taxes are based on the property’s assessed value (AV) multiplied by the applicable millage rate.

Millage rates vary by taxing district and are limited by Measure 5 (passed in 1990), with exceptions.

Assessed value is the lesser of:

• Real Market Value (RMV), which is the market value on January 1st preceding the July to June tax year, or

• Maximum Assessed Value (MAV), which is the taxable value limit of each property determined under Measure 50.

• Measure 50 amended the Oregon constitution to set the 1997-98 property tax year assessed values at the January 1, 1995 real market value less 10%. Since then the MAV has increased three percent each year, no more, no less. One of the arguments made at the time was that a three percent growth rate provided stability and predictability to the property tax system.

Portland Real Market Values (RMV) ) for the 2012-2013 tax year, as estimated by the Case-Shiller Index of median home sale prices, are still well above Maximum Assessed Values (MAV).

In other words, the Maximum Assessed Value of most homes in Portland is still well below the Real Market Value. For most homeowners, there is nothing to appeal.

So who should appeal their property taxes?

• You think the real market value on January 1, 2012 was less than the assessed value (which is usually the MAV). A bargain purchase, such as from a relative or a distressed owner, will be evaluated at its fair market value, not necessarily what you paid for it.

• You disagree with the county’s valuation of new construction, remodeling, or other exceptions. Since these are not usually identified on the property tax statement, you will need to contact the county assessor to find out the value placed on any improvements you made. It makes sense to appeal an over-valued RMV for last year’s improvements because it affects both the property RMV and the MAV. You cannot appeal the MAV later.

• You think the Assessor’s Office made a calculation error in setting the assessed valuation.

How the valuation appeal process works
The Board of Property Tax Appeals only considers assessed valuations. It can not determine the amount of tax to be assessed, nor can it consider financial hardship as a basis for changing an assessment. Appeals will only be heard for current year values, which is why the only way to affect the MAV on improvements is to appeal the RMV of those improvements in the year assessed.

Appeals must be filed between the time property tax bills are mailed and December 31st. More information is available at the Board of Property Tax Appeals web site.

If you miss the deadline or seek to appeal a prior year’s value, you may still be able to file an appeal with the Magistrate Division of the Oregon Tax Court.

As mentioned, a number of fine points have been omitted for simplicity. Consult appropriate professionals if you have concerns.

One of Portland’s leading draws for home buyers these days is its “walkability”.

The hottest walkable neigbhorhoods in Portland you ask?  Downtown, the Pearl District, and the Hollywood District.

However, more and more neighborhoods are catching on to the trend.  A development of new hip homes is being built near NIKE Headquarters in Beaverton.  Featuring a close-knit community ranging from studio flats to detached single family homes, residents will be able to enjoy easy access to work, shopping, bike trails, and public transit.

The walkability demand is representational of where home buyer’s values are lying. Not only is it better for the environment, but avoiding the hassle of parking and eliminating the expense of gas allows people to lead a more simple lifestyle.

What is also proving to be more of a priority for buyers is a sense of community.

Neighborhoods with high walk scores also tend to be more populated, featuring attached homes and very close proximity to neighbors.

A young couple who recently bought in the new development near NIKE HQ told OregonLive: “We feel this will be more conducive for meeting people and having a sense of neighborhood.”

To find the walk score of any home in Portland, use our personal home search tool by just clicking on a property and the Walk Score icon. A score ranging from 1 to 100 will reveal how close to shopping, public transit, and how pedestrian friendly the location is.

You can also visit WalkScore.com to find out a specific neighborhood’s walk score information.

Portland prices rose 0.5% in August compared with July and 3.6% compared with August 2011. Of special note, the five-month increase from March 2012 to August 2012 was a robust 9.1% in Portland. Since the Case-Shiller methodology uses a ninety day moving average, March’s low reflected transactions entered into in December, January, and February, while August’s high reflected contracts from May, June, and July. We think the strong performance from March to August shows, in addition to a seasonal bounce, a strong rebound from an overly discounted market. We predicted such a rebound in January 2012.

Seasonal variations will weaken the numbers in the next few months. The usual seasonal decline, however, will be offset by scarce inventories and fewer foreclosures in the coming months. We think prices will rise slightly through the end of the year. That would further confirm that March 2012, when Portland hit its lowest point since the boom, marked the end of the housing crash, both nationally and in Portland.

“The sustained good news in home prices over the past five months makes us optimistic for continued recovery in the housing market,” said David Blitzer, Chairman of the Index Committee at S&P Dow Jones Indices. “News on home prices confirms other good news about housing. Single family housing starts are 43% ahead of last year’s pace, existing and new home sales are also up, the inventory of homes for sale continues to drop and consumer mortgage default rates are reaching new lows. Further consumer confidence continues to rise. Even as we end the seasonally strong home buying period, the statistics are positive.”

Low interest rates continue to make this an excellent time to buy or sell a home. Low interest rate, rising rents, and low vacancies make this an even better time to invest in rental property.

What should you do? Call us at 503.222.4300 to explore some of the great opportunities in this market!

Here are a few for you to check out!

Oregon Brewery Trail
November 1st – 30th
Pedal Bike Tours
www.pedalbiketours.com

NW Food & Wine Festival
November 12th
Doubletree Lloyd Center
www.nwinefestival.com

NW Filmmakers’ Festival
November 9th-18th
Portland Art Museum
www.nwfilm.org

The Polar Express
November 10th – December 28th
Mt. Hood Railroad
www.mthoodrr.com

Celebrate! Izakaya
November 16th
Jupiter Hotel
www.celebrateizakaya.com

Oregon Turkeython
November 22nd
Beaverton
www.uberthons.com

Macy’s Holiday Parade
November 23rd
Downtown Portland
www.chooseculture.org

Holiday Ale Festival
November 28th-December 2nd
Pioneer Square
http://holidayale.com

Santa’s Workshop
November 30th
Oregon Garden
www.oregongarden.org