Two weeks ago, I submitted an offer for my clients for $125,000 over the list price on a 3-bedroom home in North Portland. That house had 14 offers. It was darling and located in a popular neighborhood with great amenities and walkability but the kitchen was a cramped one-person space at best and the roof looked tired. Sounds crazy for a market that is supposed to be slow during the holidays, right?
It depends…
A recent article published by Realtor.com projects that Portland, OR will be one of 10 “affordable” major cities to join the Million Dollar Club within the next decade. They examined sale price growth from the periods of 2014 and 2019, then applied that same growth trajectory from 2023 to 2028 to project where home prices will be in five years and then to 2033 to gauge where prices will go in the next 10 years. Here is what they came up with.
2014-2019 5-year price growth: 44.9%
2023 median sale price: $501,245
2028 price projection: $726,105
2033 price projection: $1,051,838
Why Portland?
Beyond the metrics of the study, Portland’s attraction is no accident. The Pacific NW quality of life that I love so much is attracting new residents, tech companies and high-income professionals for many reasons.
Eclectic Culture
We are a city like no other. Combine a blend of progressive ideals, creative expression and a deep connection to nature and Portland stands out as a haven for individuality and innovation drawing people from all walks of life.
Thriving Food Scene
Portland has earned a national reputation for its innovation, diversity and emphasis on fresh, local ingredients. Just ask my Mom, who is obsessed with watching food shows. She calls me regularly excited that she saw yet another Portland food cart or restaurant featured on her screen.
Proximity to Breath-Taking Natural Beauty
Where else can you access natural masterpieces like the Columbia River Gorge, Mount Hood, the rugged Oregon Coast, wine country and the high desert in less than a day’s drive? Not to mention our beloved Forest Park with its 5,100 acres of nature just steps from the city center.
Affordability
Although many would argue that Portland is far from “affordable,” urban transplants from higher-priced markets like San Francisco and Seattle continue to find high value in our city.
Tech and Innovation
Portland’s Silicon Forest has attracted major employers and startups, providing high-paying jobs and contributing to the city’s economic vibrancy. The presence of companies like Intel and Nike in the metro area has long solidified Portland’s role as a hub for innovation.
Appeal to Luxury Buyers
The rise in million-dollar homes isn’t confined to flashy mansions. Portland’s high-end market is driven by buyers seeking thoughtfully designed modern homes, green architecture, and proximity to amenities.
Challenges of Becoming a Million-Dollar Market
While crossing the million-dollar threshold is exciting for some, it also raises questions and ongoing concerns about affordability. Portland has long been a haven for creatives, young families, and retirees seeking a balance of affordability and quality of life. If median home prices soar, will Portland maintain its inclusive identity?
Efforts to address affordability, including increased density, ADU (Accessory Dwelling Unit) initiatives, and affordable housing programs, will be critical as the city evolves.
What It Means for Homebuyers and Investors
For potential buyers, this trend emphasizes the importance of acting quickly. As interest rates lower, competition will once again drive prices upwards and decrease buyer negotiating power. I am witnessing buyers hopping off the fence and stepping into the market to a greater degree.
For sellers, the rise in home values presents an opportunity to capitalize on an increasingly competitive market. As prices rise, the seductiveness of holding onto those historically low interest rates may ease as well if the return on investment becomes attractive enough.
Despite its recent challenges with homelessness, crime, affordability, political polarity and riots and a struggling downtown economy that is affecting the condo market, I have remained bullish on Portland and the life it offers. If Portland does join the Million Dollar Club, that milestone could redefine the city’s real estate market and how homebuyers and investors relate to the city. Regardless of change, I believe that the spirit of Portland is resilient and our resources in real estate and beyond will continue to foster an amazing quality of life.
