Homes below $400k make up 85% of sales in September
I recently read that in Phoenix, 93% of September Home Sales were below $400k. The author says that Phoenix is essentially a “tale of two markets”, one where homes in the lower priced spectrum are selling & where high-end homes are sitting.
We’ve looked at similar numbers before to see how the homebuyer tax credit was effecting the Portland market, so I figured it was time to take a look at these numbers again & see how we compare to the Phoenix sales by price range – here’s what I found:
% of Portland Home Sales by Price Range (September 2009)
| Sept. 2009 | % of Sales | Sept. 2008 | % of Sales | |
| $0-$150k | 190 | 10.4% | 115 | 6.6% |
| $150-$200k | 383 | 20.9% | 235 | 13.6% |
| $200k-$250k | 416 | 22.7% | 420 | 24.3% |
| $250k-$400k | 569 | 31.0% | 633 | 36.6% |
| $400k-$500k | 142 | 7.7% | 170 | 9.8% |
| $500k-$750k | 96 | 5.2% | 114 | 6.6% |
| $750k – $1 million + | 38 | 2.1% | 44 | 2.5% |
% of Sales by Price Range, Combined (September 2009)
| Sept. 09 | Sept. 08 | |
| Below $250k | 53.9% | 44.5% |
| Below $400k | 85.0% | 81.1% |
| Above $500k | 7.3% | 9.1% |
As you can see, not quite as high as Phoenix, but still 85% of sales in Portland were below $400k, which is up about 4% from last September.
Also note that sales below $250k are up 9.4% from last September. I suspect a lot of those sales can be attributed to the $8,000 tax credit (although some investors may also be cashing in on some lower priced homes as well).
The tax credit is set to expire on November 30, and the debate rages on in Washington over its extension. It seems to have given the market here a boost, so it will be interesting to see how the market fares if/when it expires.
If the tax credit does indeed expire, it would still take a lot for things to get worse this winter compared to last year. Last January we saw sales activity drag to the lowest total in the Portland metro area that we had seen since RMLS™ began keeping records in 1992.
What do you think? Did the tax credit help? Should it be extended? Leave a comment, we’d love to hear your opinion!
The tax credit should absolutely not be renewed – at least not in Portland (or Oregon, really). IHC Global Insight recently ranked four Oregon cities in the top ten most over-valued housing markets in the country. Apartment rents are falling around town, real unemployment is probably around 20% with no sign of long term improvement, and there’s an increase in housing prices? That makes no sense – it’s obviously an artificial boost caused by the $8,000 credit, and I think we’ll see prices start to slide again after the tax credit expires – which under these market conditions, it should still be doing.