The spike in home sales in April augur well for Portland foreclosure investing. This means that buyers are coming out, entering the housing market, and driving greater sales prospects for sellers and investors.
In April, closed sales shot up by 49.1 percent to a total of 1,941 homes, compared to sales in April last year. The increase in pending sales was even higher, with a 61-percent jump to a total of 2,991 purchase contracts.
Local realtors said that the April 30 expiration of the federal tax credits contributed to the sharp surge in sales. Another factor is the availability of lower-priced homes.
Homes priced below $350,000 were the ones getting bought while the properties listed at $799,000 needed to be reduced to $699,000 before they were considered by buyers.
The median price for all types of homes sold in April dropped to $240,000, down by 4 percent over the year but up by less than one percent from March. The average price was $282,100, down by 3.1 percent over the year.
At the end of April, there were 14,182 homes on residential listings in Portland. Using the April sales rate, this housing stock would be sold up in about 7.3 months, the lowest supply level in the metro area since January 2008. New listings increased by 15.4 percent to nearly 18,000 in April, but many of them got sold during the month.
Of these listings, a huge percentage are foreclosed homes, adding another positive factor for Portland foreclosure investing. With a higher inventory of foreclosures, there are more choices and prices are at levels that allow better profit margins.
Based on another online real estate information provider, there are currently 13,209 homes for sale in Portland, 63 percent of which or 8,385 units are foreclosed homes. With this number, buying foreclosed houses for sale in the metro area at great prices is viable.
Investors can also look at foreclosed homes in other areas in Oregon, as well-maintained houses listed at great prices can still be found despite the slowdown in foreclosures. Just like many other states, foreclosure activity declined in Oregon in April.
Based on foreclosure figures released by a real estate firm based in Eugene, a total of 1,494 homes in Oregon were notified of default in April, down by 9 percent from the 1,634 houses that became delinquent in April last year. The April number however is still adequate for foreclosure investing in Oregon.
The largest default decreases occurred in Linn, Crook and Polk counties while the biggest increases were posted by Benton and Curry.
While Multnomah County, where Portland is the administrative city, was still experiencing the highest number of foreclosures, the pace has slowed in April.
The Gorilla Oregon Foreclosure Index, which measures foreclosure situations in 15 Oregon counties, was 393 in April, a drop from the 468 level in January. This means that the Oregon housing market is improving and is nearing 100 – the index for normal housing market conditions.
With the state and metro markets starting to recover, Portland foreclosure investing can be considered a workable and profitable endeavor.
John Cutts has been educated in the finer points of the foreclosure market over 5 years.
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