Portland Oregon Real Estate Market April 30, 2015

Cash is King

We've heard the adage "Cash Is King" when talking about real estate.  However,  it has historically been associated with getting a "deal" or significantly lower purchase price.  In our local Portland real esate market, that "deals ship" sailed about two years ago.  That said, now many buyers looking to purchase in close-in Portland and attractive surrounding neighborhoods and cities are facing multiple offer situations, with many of those offers being all cash.

Most first-time and move-up buyers need to acquire a mortgage to help finance the purchase of their new home.  It's the norm to have a conventional loan of 5%-20% down.  Two years ago, this truly wasn't an issue for buyer's looking to purchase, as seller's would accept these offers without thinking twice.  Now, these buyers face multiple offers, sometimes 10%-20% over list, with all cash often winning out.

Why is cash better for sellers?  It's one less hoop that can cause a problem for the transaction.  With a financed purchase, the loan has to go through underwriting that can sometimes throw up a flag.  Even more of an issue, however, is no appraisal is required with a cash purchase.  With homes going so much over list price, an appraisal could definitely cause a problem.  

Here's a fabulous in depth article that explains what is driving our Portland market, and how this cash is making its way to our area,  Cash is King .  Believe me, we who work in this market are hoping to return to some normalcy, but it doesn't appear it will be anytime soon.  

 

 

 

Portland Oregon Real Estate MarketSE Portland, OR. Homes March 26, 2012

Competing in a Multiple Offer Market

Here in Portland, the market has definitely displayed a big shift over the past three months, with increased buyer activity and inventory levels lower than they have been in more than two years. It’s not uncommon for buyers to find a home, only to find out that they will be facing a multiple offer situation. Just the other day, I checked with a listing agent on a home in North Portland, and found out that they had 26 offers come in on that property! I have clients that have been looking for a home in Southeast Portland for over six months. The first day a cute home came on the market, we ran over to view it. It was “the one!” In checking with the listing agent we found out we were facing multiple offers. My clients and I sat down and carefully crafted an offer that got them the home they wanted!

If you find yourself competing against other offers for your dream home, keep in mind there are many other facets to writing an offer than just the sales price. The amount of the earnest money deposit, amount of the down payment, type of loan, personal property to be included, length of inspection period, length of escrow, home warranties, etc. are all important items that can make an offer look more or less attractive to a seller. You and your Realtor should discuss these issues in advance of finding your home, so you are confident in the offer you write. If you are selling your home, make sure your real estate agent addresses these items ahead of time.

Remember, it’s not always just about “the price.”