How’s The Market? A Look at December’s Real Estate Numbers

Despite the worsening pandemic and the holiday season, the housing market in Portland stayed strong in December.

Compared to December of 2019, prices increased by over 12%, and we also saw double-digit increases in New Listings, Pending Sales, and Closed Sales. The amount of time it took a home to sell in December fell slightly compared to November and by over 20 days (-37.5%) compared to last year. These changes were precipitated by another drop in inventory to just 0.8 months – the lowest ever recorded in the Portland Metro Area. This means if no more homes were to be listed for sale, it would only take about 3 weeks for all the homes currently on the market to sell. This low inventory creates intense competition for existing homes, driving up prices and driving down the amount of time it takes a home to sell.

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Lower inventory isn’t all that unusual for December, but such high prices and decreasing Total Market Time is uncommon for a month where we typically see activity slow down. For example, when we look at the Total Market Time (also called Days on Market or DOM) over the last four years we see a very predictable pattern of homes selling more quickly in the late spring and summer (lower DOM) and then more slowly through the fall and winter (higher DOM). But in 2020 that seasonal pattern didn’t play out. Instead, we see that DOM stayed low and spent the latter half of 2020 lower than the lowest point in 2019. We can attribute some of this change to the pandemic  that essentially halted activity during the spring – typically the busiest time of year for real estate – and pushed it  later into the year. But that doesn’t fully explain why November and December were still so busy. The historic low interest rates we’ve seen for some time continue to entice buyers into the market and we just don’t have enough  sellers listing their homes to absorb all the buyers. This continues to push inventory down, and prices up.