The November 2014 RMLS Market Action just came out, and while some may notice that pending and closed sales declined, prices stayed even, and inventory increased compared to October, focusing on the month-to-month change is misleading. November performance drops off from October almost every year. We think it more instructive to compare November 2014 to November 2013.
Last month pending sales (2,091) increased 14.4% from November 2013 (1,827), and closed sales (1,937) increased 6.4% from November 2013 (1,821). Those are big numbers. Furthermore, the average sale price rose 5.6% and the median sale price rose 6.3% compared to November 2013. The average sale price for the first eleven months of 2014 was up 7.2% and the median sale price up 7.5% compared to the first eleven months of 2013. The Portland housing market has pretty much recovered from the real estate crash of 2008 to 2012.
Looking forward, our favored short-term metric is months inventory, i.e., how many months would it take to sell all the homes on the market based on the number of closed sales that month. Six months is generally considered a balanced market.
November 2014 ended with 3.2 months inventory, up from 2.8 in October and down from 3.7 in November 2013. Since 2003 the average inventory for the month of November has been 6.0 months, so 3.2 months indicates an extremely under-supplied market for this time of year. This factor alone is putting enough upward pressure on prices to mostly offset other typical seasonal declines.
The take-away? Best winter in years in which to sell a home!