The Good. The Bad. The Ugly (May Market Report)

The Good:

-Monthly pending sales activity up 5.8% (vs April 2009)

-Monthly closed sales activity up 9.6% (vs April 2009)

-New listings up 1.9% (vs April 2009)

-Inventory dropped from 11 months to 10.2 months – the fourth straight month of inventory absorption

-Month-to-month average sales price stayed solid

The Bad:

-Year-to-year pending activity down 7.4% (vs April 2008)

-Year-to-year closed sales activity down 23.4% (vs April 2008)

-New listings dropped 25% (vs April 2008.) – Note: I view this as a long term “good” thing.

The Ugly:

-Year-to-date closed sales down 28% (vs year-to-date 2008)

-12-month average sale price vs previous 12-months down 8.1% ($315,500 vs $343,200)

The Conclusion:

Here’s the takeaway in a nutshell; The 2009 market is more or less stabilized. Inventory is being absorbed, which will eventually bring balance back to the market. Sales activity is up with sales price staying constant. However, 2009 market activity is down about 25% compared to last year. That’s actually an improvement over the previous months where the 2009 market was down about 33%.

Obviously buyers and sellers are most interested in prices and the 12-month average sales price is down about 8%. From my own experience, that feels about right.

Here’s a quick look at the appreciation (uh, depreciation) numbers in your neighborhood:

· N Portland -6.4%

· NE Portland -4.3%

· SE Portland -7.7%

· Milwaukie/Clackamas -3.4%

· Lake Oswego/West Linn -17.4% (Wow. Those million dollar homes are getting killed!)

· W Portland -27.7% (Ditto!)

· Beaverton -13.3 (Maybe we should just say, “The suburbs are getting killed!”)

CLICK TO ENLARGE

CLICK TO ENLARGE

Market Action provided courtesy of RMLS.

Tim Geithner Just Like You and Me

The market reality hit home, well, it hit Treasury Secretary Tim Geithner’s home. 

After trying to sell his multi-million dollar English tudor in a post New York suburb, Secretary Geithner is throwing in the towell.  Geithner bought the 5-bedroom tudor for 1.601 million dollars after a bidding war helped drive up the price.   He originally tried to recoup his investment, but after seeing very little action the price was dropped to a “very affordable” 1.575 million.  Still no takers.

Just like many other frustrated sellers, Secretary Geithner took his home off the market and offered it up as a rental.  Honestly, I’m very happy to see the savvy, though emotionally difficult, decision.  Perhaps it bodes well for our nation’s economy that our Treasury Secretary was able to make the difficult decision to not throw good money after bad.  The rental move, in this case, was the right one.

Hopefully having the economy’s woes hit so close to home will super-motivate the man to work on the national housing market.

http://money.cnn.com/2009/06/03/real_estate/Geithner_housing_market/index.htm?postversion=2009060411

Driving for Green Housing

Talk about necessity being the mother of invention, Rod Boydstun creates a new real estate niche: Affordable green housing. Oh yeah, did I mention that he’s using junked cars as a main component?

Most of us have at least one mad scientist engineer in our lives. You know, the guy who can get all MacGyver with it at a drop of a hat? Stuck in the snow? No problem, he can build a tow rig out of your shoelaces, a stick of Juicy Fruit, a seat belt latch and the remains of your leftover lunch.

Rod Boydstun has taken that a few steps farther and actually created a marketable product. His drive to change the way homes are built while borrowing from the good ol’ “reduce, reuse, recycle” mantra is laudable. The quality of his homes, though, are incredible.

To take a deeper look into Rod’s world, check out mirandahomes.com and The Oregonian article at http://www.oregonlive.com/hg/index.ssf/2009/02/junked_cars_morph_into_green_m.html

Baseball in Lents…Rounding Third (uh, maybe)

PGE Park - Baseball

…and the debate goes on and on. Do we bring baseball to Lents, thereby freeing up PGE Park for the Timbers, Major League Soccer’s newest expansion team?

The question is pretty straight forward on it’s surface, but of course when political heads get heated, nothing’s ever simple. There are a few questions at play. First, should there even be talk of a new minor league ballpark during a historically bad economy? If so, where is the best place for that ballpark? Third, assuming a ballpark is necessary and desired, who should pay for it? Let’s take a quick look at the three questions. By the way, I do not claim to be an expert on this issue, but I’m certainly interested and since I represent a major player in the rebuilding effort for affordable homes in Lents, I feel personally drawn to the question.

So, is this the right time to even discuss building a new minor league park? Look, I’m both a sports fan and a businessman, so in my opinion it’s always a good time to talk about bettering our city through the intelligent use of sports franchises. I’m a big believer that professional teams are beneficial to a community. If done correctly, sports franchises are a huge economic boon. Additionally, a cities livability tends to increase with additional world class recreation options. I’d listen to arguments in opposition to that supposition, but on it’s face, I’m a believer.

In bad economic times, I think outside-the-box thinking is even more important. Sometimes you have to swing for the fences! (yes, a shameless baseball plug) When Japan’s economy collapsed after the second world war, the government held an economic summit to figure a way out. What they came up with was something akin to, “Times of deep depressions, the darkest times, are the best for paradigm shift.” They came up with the first ever Bullet Train technology, which connected Osaka and Tokyo, Japan’s two largest cities and centers of business. The economy flourished and Japan’s status as technology leader went unchallenged for a generation.

OK, if building a stadium is a good idea (not a given, I understand) then where should it be built? There are there major options on the table. First, move the Beavers out of Portland all together by building a stadium in the ‘burbs, Hillsboro or Vancouver potentially. There are certainly some logical reasons for this, but as a fan of Portland proper and the metro lifestyle, I’d be appalled if the team left Multnomah county. The two remaining choices, then, are to refurbish or rebuild the Memorial Colliseum in the Rose Quarter or, alternatively, attempt to help economically challenged Lents by building the stadium there. The Rose Quarter makes an awful lot of sense to me, seeing as it already houses Portland’s one major league franchise, the Blazers, and is perfectly ready to hold a second team. The land is available, it would not negatively impact home owners, and would be a boon to local business. Makes sense to me. It apparently made sense to the City Council, too, seeing as a Rose Quarter stadium was agreed upon and nearly signed off on just a few months ago.

However, this is politics and, as I mentioned, politics is never easy, so the Council went back to the drawing board to revisit the idea of a Lents based stadium. The argument is that a stadium of this type, along with minor league baseball, will bring much needed economic growth to the hard scrabble Lents district. If that truly is the case, then perhaps this is a good alternative. I have my doubts, though.

First, in order to build the stadium in there, Lents park will have to be removed. The stadium will take its place. Personally, if I’m a local home owner or renter, I’d much prefer a park for my kids to a park for professional baseball players. On the other hand, if the stadium will truly bring in newer and better businesses to the local community, which would bring in much needed jobs, then that’s an argument I’ll listen to. I do not have a final opinion on this piece, simply because there are too many unknowns to which I’m not privy.

Clearly I’m not going to come to a definitive conclusion on whether the Rose Quarter or Lents, or even the ‘burbs, is a better location for the new stadium, however I do think it’s important to discuss how exactly the new project will be paid for. For the moment I’m simply going to focus on Lents as the final destination. My understanding is that the Beavers’, a privately owned baseball franchise, new home will be paid for in several ways. One of the sources would be the Lents Urban Renewal Fund. That money is slated to be used for new affordable housing. This is an issue I’m closely connected with, as one of my non-profit clients is a major player in Lents urban renewal. In fact, their mission is to bring affordable housing to Lents while improving the overall community. Much of their efforts results in urban blight being turned into beautiful affordable housing, which raises the level of the Lents neighborhood.

Look, the urban renewal dollars are critical to any new affordable housing projects. We can argue back and forth on whether the stadium is a good idea or not or even whether it is more important than Lents based affordable housing. You can make your own decision on that. To me, though, what is not OK is the re-purposing of urban renewal/affordable housing dollars for a stadium to house a private franchise. In essence, Lents would be giving up a public park and the opportunity to beautify the neighborhood through smart urban renewal projects. All this for a stadium for a private franchise for a minor league sport with limited appeal.

Again, my argument is not whether the stadium should be built or not or even where it should be built, I simply have a beef with the funding source. Obviously, this is a much deeper issue than can be honestly discussed in a one page blog and I fully admit that I do not know enough about local politics or the overall project to make a final decision. However, one thing is crystal clear, shouldn’t the public have a say?

Shouldn’t county residents get a vote? Shouldn’t Lents and or Rose Quarter residents get a vote? Should such a monumental decision be made under the cover of darkness with privately held meetings by publically appointed (and publically paid) representatives? Why won’t the city allow the people to have a voice?

OK, I’m now off my soapbox…feel free to set me straight.

Proposed Lents Stadium