Real Estate Prices Picking Up in NW Oregon

by Erik Knoder

December 5, 2017

Home prices are rising in many cities across the nation. The widely quoted Case-Shiller Index of national home prices showed a 6.2 percent increase over the year in September 2017. This raises the question, how is the real estate market in Northwest Oregon? The answer is that most Northwest Oregon counties are doing as well or better. Residential property median sales prices rose 10.4 percent for the North Coast region (Clatsop, Tillamook, and Lincoln counties combined) over the last year to September. (Based on a 12-month moving average.) In Columbia County, average sales prices rose 9.2 percent over the last year to September, also based on a 12-month moving average.
North Coast residential prices increased faster in 2017 than in 2016. In 2016, the median price increase was 5 percent over the year to September. The story was different in Columbia County where the average price increase was 11.7 percent over the year to September 2016. So, the residential market heated up along the north coast in 2017, and cooled just slightly in Columbia County, but both areas saw strong price increases.

The monthly median sales price bottomed out in January 2013 in the North Coast region at $175,000. Monthly average sales prices (shown in the graph) are usually higher and more volatile. The low point for monthly average sales price for the three counties was $210,300 back in February 2011. By both measures it seems certain that the low point in housing prices has passed for the north coast.
The 12-month average of Columbia County’s sales prices reached its low point in January 2012 at $156,033. It was $270,958 in September 2017.

The number of closed sales (1,322) in the North Coast region from January through September of 2017 was about 100 more than during those same months in 2016. In Columbia County, the number of closed sales (702) from January through September was essentially unchanged from 2016, which saw 706 closed sales. All told, it seems as though the market in Columbia County has moderated a bit from the previous year.

The data are from Regional Multiple Listing Service (RMLS) of Portland and combine Clatsop, Tillamook, and Lincoln counties into one reporting area for the North Coastal counties.

One drawback in using home sales to evaluate the real estate market is that the quality of houses sold each month is not consistent; one month may see more high-quality houses sold, the next month may see more low-quality houses being sold. One way around this problem is to use economic models to estimate values for all the residential property in an area. Zillow does this modeling and makes the data available on the company’s website. Their estimates for the median home values are shown in the graph.

Zillow does not have data for Clatsop County. The estimates for the other four counties in Northwest Oregon show that home values have surpassed their pre-recession highs in Benton and Columbia counties. Median home prices in Lincoln and Tillamook counties’ have not yet attained their pre-recession levels. Zillow’s estimates of Lincoln and Tillamook median values somewhat contradict the home sales data from RMLS. Zillow shows a dip in value in late 2017, but RMLS showed strong growth in median prices for the north coast as a region. But these data sets do measure different values in different ways so some discrepancies are to be expected.

It may be some time before employment in real estate related businesses returns to pre-recession levels. Comparing July 2007 with September 2017, the finance sector, which includes real estate brokerages and mortgage companies, is still down 120 jobs in Benton County, 30 jobs in Columbia County, 110 jobs in Lincoln County, and 170 jobs in Tillamook County. Only in Clatsop County has the industry passed its pre-recession level and added 20 more jobs.

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