Redfin has ranked the country's slowing housing markets in terms of prices, price drops, supply, pending sales, sales-to-list ratio, and speed-of-home sales. Seattle was first on the list, while Portland registered at 14th.
“These are all places where homebuyers are feeling the sting of rising home prices, higher mortgage rates and inflation very sharply. They’re slowing down partly because so many people have been priced out and partly because last year’s record-low rates made them unsustainably hot,” said Redfin Chief Economist Daryl Fairweather in a release. “The good news is that the slowdown is dampening competition and giving those who can still afford to buy more negotiating power.”
Read more at BizJournals.com.
This week our update includes the latest forecast on interest rates, unemployment, and the likelihood of a recession.
GlobeSt.com reports multiple sources are registering multifamily rent growth has slowed, with Redfin publishing data indicating August rents increased at the slowest rate since December last year.
According to Redfin, August median asking rents grew 11% year-over-year (0.4% month-over-month) – the smallest hike in a year – to $2,039, the slowest growth since December 2021 and down from a 1.6% increase a year earlier.
Redfin Deputy Chief Economist Taylor Marr pointed to higher interest rates impacting the rental market and having "put a damper on spending power in the economy as a whole, including renters’ budgets."
Read more at GlobeSt.com.
Congratulations to HFO Broker Greg Frick and the rest of the HFO team on the sale of 12-unit Omega Townhomes in Hillsboro, OR.
Visit HFORE.com/transactions.aspx to learn more about recent HFO transactions.
This special interview features attorney Quinn Posner of Northwest Landlord Solutions. Quinn is an attorney licensed to practice in Washington and Oregon. In this interview specifically relevant to multifamily owners in Washington, Posner states:
This week: How the Inflation Reduction Act will affect the multifamily sector, Oregon's maximum rent increase for 2023 explained, and why multifamily rent growth stalled in August 2022.
Listen wherever you get your podcasts, and check out the full library of HFO's Multifamily Marketwatch podcast at HFORE.com/aspx.
On our most recent episode of HFO-TV, Oriana Magnera, Verde’s Energy and Climate Policy Coordinator, discusses the resources available to landlords through Oregon's new heat-response programs and the nonprofit group's efforts to distribute portable cooling units to those in need.
Watch the full interview on YouTube or at HFORE.com/videos.aspx.
Visit HFORE.com/transactions.aspx to learn more about recent HFO transactions.
Check out the latest episode of the HFO Multifamily Marketwatch podcast! This week, Elliott Barnett, Senior Planner, City of Tacoma, discusses the Home in Tacoma housing plan with Broker Aaron Kirk Douglas.
Governor Inslee announced the end of all COVID emergency orders effective October 31, Seattle multifamily housing construction reaches new highs, and a Seattle citizens group has landed an initiative on the ballot to create a low-income housing development agency owned and operated by the city.
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However, for the first time since June 2020, the national average multifamily rent declined, decreasing $1 to $1,718 in August. Year-over-year growth decelerated to 10.9%.
The report attributes moderating rent growth to typical seasonality, slowing migration, and the cooling economy.
"The deceleration in August was strongest in many of the markets that have had the most growth over the past two years, a sign that affordability is becoming an issue."
Year-to-date rent growth is still higher than any previous year with the exception of 2021, and the national occupancy rate was 96.0% for the fifth month in a row in July.
Portland Employment and Supply Trends; Forecasted Rent Growth
Read the full report at YardiMatrix.com.
Gov. Jay Inslee of Washington announced Thursday that all of the state's remaining emergency proclamations related to COVID-19 will be rescinded effective Oct. 31st.
Only 10 of the total 85 orders enacted in the state since February 29, 2020, are still in effect. All will be rescinded on October 31st, including the controversial proclamation 21-14 on vaccines, which requires state workers, staff at educational facilities, and health care employees to be fully vaccinated against COVID-19.
Most Washington state agencies will maintain vaccination mandates after the governor’s order is rescinded, and private employers can still choose to require employee vaccination.
Read more at TheOlympian.com.
Three major semiconductor companies are looking at Oregon for investments ranging from $6 billion to $8 billion, which could translate to 10,000 new jobs, the Portland Business Journal reports.
Oregon is already home to 15% of the national semiconductor workforce and is a research and development hub for semiconductor manufacturing due to the presence of Intel’s facility in Hillsboro. The company, which is already the state's largest employer, announced plans in 2021 to hire thousands in the coming years as it ramps up production in Oregon.
Read more at BizJournals.com.
The average monthly mortgage payment for a median-priced home is now $1,000 greater than the average rent payment, up from $280 pre-pandemic, write Marcus & Millichap researchers in an August brief on housing affordability.
As a result of this "affordability gap," the report notes, the estimated minimum annual income needed to afford a house in the U.S. surpassed $120,000 in June, a threshold that more than 73% of households cannot afford.
Despite effective rental rates growing nearly 17% in Q2 2022, apartments remain "a markedly less-costly option than home ownership."
"Given that the minimum annual income needed to buy a home is now well above $100,000, doubling in a span of just six years, a sizable portion of millennials will rent longer than past generations. It is increasingly likely that Gen Z will follow suit. These circumstances reinforce the imperative need for historic levels of multifamily development to help relieve excess demand."
Download the full report at MarcusMillichap.com.
July data from the Downtown Seattle Association indicates 40% of the 2019 downtown Portland office workforce had returned as of July 2022, just ahead of Seattle's 39%. The organization used cell phone location data to compile its information.
Downtown vacancy in Portland was 26% in 2022's second quarter, according to CBRE.
Read more at BizJournals.com.
"Thankfully — despite some challenges at the local and national levels — Portland’s affordability on a regional basis remains attractive to investors," writes Jordan Carter, executive vice president for Kidder Mathews, in a recent RE Business Online column. "If the Great Recession indicated how the Portland multifamily market might weather an upcoming storm, there are plenty of reasons to remain optimistic."
At 4.53%, the company's vacancy rate is well below the national average of 4.98% reported by CoStar, according to Carter. Year-over-year rent growth of 8.5%, which CoStar predicts will remain around 5% for the next couple of years, has pushed average apartment rent to $1,600 per month, and the competitive single-family home market continues to drive prospective home buyers out of the market.
By year-end, Carter writes, though the volume of sales will be dramatically down from the historic levels of 2021, demand for well-located properties in Portland is expected to remain consistent, especially for those with a value-add component.
Read the full column at REBusinessOnline.com.
Congratulations to HFO broker Jack Stephens and the rest of the HFO team on the sale of Tigardville Apartments in Tigard, OR!
Oregon once again topped the list of Oxfam's 2022 Best and Worst States to Work in America. The international anti-poverty charity's annual report ranks the U.S. states on compensation and conditions for workers, considering wage policies, worker protection, and the right to organize.
Oregon received the highest score on the list for the right to organize (100) and worker protection (96.43) but fell below several others for wage policies (69.93). However, the state's overall score (86.72) places it just above California (85.56).
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| OxfamAmerica.org |
Oregon also received top marks on the organization's list of the 2022 Best and Worst States for Working Women, with an overall score of 94.93 — well above the second-highest ranked on the list, California (89.32).
Read the full report at OxfamAmerica.org.