Helping Families One Home at a Time

January 2002

The number of closed sales, fell by 4.6%.  At the end of November, a total of 10,440 active residential listings were in RMLS " for the Portland metro area.  Given the number of closed sales for the month, the areas available inventory calculates to 6.2 in months. 

Year-to-Date Trends
Closed sales since January have exceeded the total for the year of 2000 (24,656). Comparing only January-November 2001 to 2000, closed sales increased by 9.6%. Similarly, pending sales increased 9.9% for the year to date.  New listings, however, show only a slight variation. The number reported since January for 2001 fell by 1.7% when compared to January-November 2000.

Appreciation 
For the 12 months ended November 2001, versus those ended November 2000, the average sales price of residential listings appreciated 1.6% ($201,400 versus $198,200).  Median sales price also grewup 2.7% to $169,900 from $165,500.

Median Sales Price of Existing Homes - 3rd Quarter
The median sales price of existing homes in the U.S. rose to $151,200 in the third quarter, up 6% from the same period last year.  Here are median sales figures for Western cities:  San Francisco area - $474,100,  Los Angeles area - $248,300, Denver - $224,000, Portland - 174,900, Salt Lake City - $153,000, Las Vegas - $151,800, Phoenix - $142,700, Boise - $132,700, Spokane - $113,100.  Source:  National Association of Realtors.

Area

Average
Sales
Price

Percent
Appreciated
**See note

North

Northeast

**Neighborhood

Average
Sales
Price 2001

Average
Sales
Price 2002

Northeast

   Alameda

   Irvington

   Laurelhurst

**Please bear in mind that neighborhood values are, at best, good estimates.  We extract the data from the Regional Multiple Listing System (RMLS) files, tweak the data, and then do the calculations.  The problem has to do with the boundaries; historical versus neighborhood associations.  Some real estate firms (each firm inputs the data for their particular listing, transaction) use the historical boundaries and some use the current neighborhood associations' boundary.  We use the boundaries established by the Office of Neighborhood Involvement (ONI).  Also, beware that some neighborhoods have only a few sales in a given year so averages tend to fluctuate widely between years.

***For detailed average pricing, visit the "Neighborhood Profiles" section of the Website:   Northeast, Southeast,  Downtown, West Hills and Southwest.

In Freddie Mac's Primary Mortgage Market Survey, the 30-year fixed-rate mortgage (FRM) averaged 7.16 percent, with an average 0.8 point, for the week ending December 28, 2001, nearly unchanged from 7.17 percent last week. A year ago, the 30-year FRM average was 7.13 percent.  The FRM in the West was 7.15 with an average 0.7 points.

As of January 2nd, a few mortgage lenders such as Washington Mutual were offering 7.25% on 30-year fixed mortgages - no points.

Refinancing  Mortgage refinancing is on track to reach an all-time high of $1 trillion in 2001, surpassing the 1998 record of $750 billion.  It may be the end of the largest refinancing wave ever if mortgage rates, which move in line with U.S. Treasury yields, do not head lower.  Mortgage rates could fall one more time on an expected bond rally in the near future. 

Locking in a Mortgage Rate  With interest rates on the rise, you may want to lock a rate. David Dishman, a mortgage broker at Stevens Mortgage in Portland, offers this advice: 

Most lenders offer rate locks of varying length.  The most common lengths for rate locks are 30, 45, and 60 days. Longer locks are available up to 180 days, however, those are mostly for new construction and can be very expensive.

Most lenders (including Mortgage Brokers such as Stevens Mortgage) do not charge for rate locks.  Rate lock deposits are common on the longer length locks.  Also, it is best for the client to clarify with the lender or mortgage broker the policy on rate drops if the loan is locked and rates decrease.

Contact David Dishman either by telephone (503.670.0481) or e-mail with any questions. 

To check on local mortgage rates go to Bankrate.  To talk with a mortgage broker, consider: 

• Associated Mortgage Group   They are licensed in both Oregon and Washington.    Telephone:  (503) 221-0064  Fax:  (503) 221-0396.  Mr. Dave Jolivette is the contact.
• Stevens Mortgage  Telephone: (503) 670-0535  Fax: (503) 670-0481.   Mr. David Dishman is the contact.

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 Whole Foods Market will open March 15 in the emerging Brewery Blocks development in downtown Portland, helping launch the high-profile mixed-use project and becoming the first store in the Texas-based chain to arrive in Oregon.

Mark Edlen, a principal in Gerding/Edlen Development Company, said the market would take 45,000 square feet in one of the buildings in the five-block development bordering the north side of West Burnside Street from 10th to 13th avenues.  Soon after, several other tenants will open in the development.

Meanwhile, the developers have gotten design review approval for a 15-story condominium facing Couch Street between 10th and 11th avenues.  Pre-construction work is underway on that building, expected to yield about 125 for-sale units at market rate.  The building would be adjacent to the old Armory between Couch and Davis streets, which will be redeveloped with heavy emphasis on retail.

Whole Foods' debut comes in a development projected to yield 1.7 million square feet of space in the old Henry Weinhard Brewery complex.  The blocks will contain retail and restaurants, housing, office and light-industrial space, along with parking for 1,350 cars, space for bicycles, and showers and lockers for those who use non-motorized travel.

Planners and developers cite the project as a point of departure for the future of the downtown and a defining gateway into the city from the west (Barnes Road).

After 34 straight days of rain, short one day of setting a record that was established in 1948, the sun came out on Sunday, December 23 and we had over a week of beautiful weather.  Along with some family members visiting for the holidays, we jumped in the car and headed up to Mt. Rainer for some snowshoeing, meeting friends at the mountain.  We knew it was going to be a glorious day when we saw Mt. Rainer peeking behind Mount St. Helens as we left Portland.  As we descended the trail back to Paradise Lodge late in the afternoon, we looked to our left and noted the sun on a mountain side laden with evergreens.  Above the sunny mountain, the white half-moon stood out against the blue sky.  It was one of those winter days in the Pacific Northwest that drowns out the 34 days of  rain.

Last year we had a drought, and it is officially over!  Mt. Hood already has close to 140 inches of snow at 6,500 feet.  The entire Cascade range is blanketed in heavy snow.  The snowpack is just as important to Oregon's economic health as the winter rains.  The melting snow feeds rivers and lakes in the summer and fall.  This provides the water for agriculture crops and power.  Snowpack is what keeps the reservoirs full - the source of water for residents.  Snowpack is also important to anglers and conservationists.

Ever year at this time, snow hydrologist Stan Fox straps on snowshoes and packs a 12 1/2 foot aluminum tube up to the mountains in Oregon.  He measures snowpack which is a combination of snow depth and moisture content.  It's early yet, but the water content of the snowpack statewide is 155 percent of normal for this time of year.  Last year at this time, it measured at 79 percent of normal.

Oregon's Initiative and Referendum Law always has a measure that can get a chuckle out of an Oregonian.  This year, our favorite is the "Road Kill" initiative. 

A Crook County couple wants to get elk and deer carcasses off Oregon's roads and into its kitchens.  So far, Prineville resident John Wakeman has gathered about 600 signatures on a petition backing the Oregon Deer or Elk Road Kill Law, a bill he drafted with his wife, Sheila Clauson.

The idea hit after the couple saw a deer rotting on the roadside -- a shame, Wakeman said, because fresh meat on the street could be good to eat.

"To be honest with you, I never have taken road kill," said Wakeman, a hunter who owns Prineville's 7-Eleven. "But if it was still fresh? If there was some meat that was bruised, I'd just cut that part out."

Wary of pickup poaching, the law would require drivers who hit or find a deer to call state police, identify themselves and offer police a chance to inspect the animal and decide whether it should go to charity. If not, a motorist could take it.

To keep poachers from shooting game, dragging it to a highway and running over it, the law would prohibit drivers from killing dying animals with arrows or bullets.

State troopers that see a deer get hit sometimes inspect the meat and, if it's edible, give it to a shelter, state police spokeswoman Sally Gilpin said. But it is illegal to hunt with a car, she said. You must shoot elk and deer -- in season -- with bullets or arrows to legally tag and take them.

Oregon Initiative and Referendum Law  Initiatives are citizen-sponsored amendments to either the constitution or to statutory law.  Referendums give citizens the power to refer and vote on acts passed by the previous Legislative Assembly, as long as the act does not take effect earlier than 90 days after the end of the assembly.  Referrals are proposed laws that the legislature has sent to the voters to either approve or reject.

Who sponsors initiatives, referendums and referrals?  Initiatives are sponsored by any citizen or organization in the state, as are referendums. Referrals are sponsored by the state legislature.  To learn more about the law, visit BallotMeasure.

Oregon unemployed will be eligible for up to 13 weeks of extended benefits because its average unemployment rate for September, October, and November topped 6.5 percent.  The benefits start in early January.

Oregon law dictates that the state government have a balanced budget - it does not permit deficit spending.  In a recession, this means cuts.  The governor and the state lawmakers are wrestling to cut $850 million out of the $12.3 billion budget.

The year 2001 will be a record for home loan refinancing.  At one point in November, interest rates plummeted to the mid-6 percent range.  Since then, home loan interest rates increased to just over 7 percent, still a bargain rate.  Robert said in mid-December, "it's not too late to jump aboard the mortgage refinance bandwagon.  Lenders have lots of money to loan on affordable terms."  Here are some excerpts from his article:

Before beginning your home loan refinance quest, write down why you want to refinance. Maybe you want to accomplish a special finance task, such as pay for a child's or grandchild's college tuition. 

Before "dialing for dollars" to mortgage lenders, the best way to start mortgage refinancing is to check your credit report and FICO score. Most lenders use some form of credit scoring to qualify borrowers. Unless you have a FICO score of 620 or higher, refinancing will probably be expensive. Most lenders use the FICO (Fair, Isaac and Co.) score that considers your debt-payment history and whether you've been on time or late (the most important criteria) and the total amount of credit available to you (even if you pay off your credit cards each month).

Another consideration is how many credit inquiries you had within the last six months. Surprisingly, your income is not part of the FICO calculation, which predicts the probability you will default on a loan.

You can  invested $12.95 to obtain your credit report and FICO score at MYFICO.   Received an Equifax (one of the "big three" credit bureaus) credit report, a FICO score and an explanation of how you can improve it.

If your credit report reveals errors, the explanation tells how to correct them. Ask each credit bureau to verify the mistake, correct it and send you a corrected report within 30 days. My advice is to follow up after 30 days for the best results.

Easier Refinancing  Fannie Mae and Freddie Mac, the nation's largest home loan lenders, recently announced, effective Jan. 1, 2002, they will buy home loans up to $300,700. This is up from $275,000 in 2001.

The result is home loan borrowers up to $300,700 will get the lowest interest rates available. Loan limits for FHA mortgages were also recently increased but not nearly as high.

If you want to refinance with a "jumbo" mortgage, generally considered up to $650,000, you will pay a slightly higher interest rate. The reason is Fannie and Freddie can't buy your mortgage, so the resale secondary mortgage market is more limited. Should you want to borrow more than $650,000, called a "super-jumbo" mortgage, expect to pay a slightly higher interest rate because of the limited resale mortgage market.

My Advice  

1. Dial mortgage lenders until your fingers hurt when checking out rates.  You will be surprised at the range of quotes you'll receive.  Just a quarter point can save you $25 a month on a $150,000 30-year mortgage.  Points and fees can also vary widely between lenders.
2. Make certain you obtain a written disclosure of all loan costs in advance from any mortgage broker or direct lender with whom you do business.  Be prepared to challenge any large discrepancies between the quote and the actual fee(s) at closing.  In Oregon, you have three business days after signing the final papers to revoked the transaction - this applies only on  refinancing.
3. After you get all the quotes and start comparing, you may find a lender or broker who you would like to do business with but their rate was higher than your lowest quote.  Call them back and tell them that you would like to do business with them but they need to match your low rate.  They may surprise you and readily agree.
4. Last, when you lock a rate, agree (get it in writing) what happens if the rate drops before you close.  

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