November 2003 Newsletter
by Susan Marthens
Contributors Gail Mann and Teresa Kirsch

In This Issue

1. Portland Home Market - September 2003 Residential Highlights

2. Cost of Residential Homes in the Portland Metro Area - September 2003

3. Long-Term Mortgage Rates

4. Portland Weather

5. Public Utility District - Special Election

6. Kitchens & Bath

7. Wildland Fires in Portland

8. Timberline Lodge

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Portland Home Market

September 2003 Residential Highlights

Someone took some time out of the new school year to buy some houses. September’s closed sales climbed 44.8% higher than sales in September of 2002. Pending sales, while not as stratospheric,  managed to climb 5.5%. New listings, on the other hand, were down by 2.1%. At the end of the month, the Portland
metro area had 10,277 active residential listings. Given the rate of sales in September, that inventory would last 3.6 months.

Appreciation

Comparing the 12 months ended with September to the 12 immediately preceding them, average sale price rose 6.3% ($219,900 v. $207,100) and median sale price rose 5.5% ($184,500 v. $174,900).

Third Quarter Report

September closed the third quarter of 2003, a quarter in which market activity clearly increased over the same time period in 2002. Closed sales showed the greatest growth, up 28.6% (9,061 v. 7,047). Similar ambitions affected accepted offers, which rose 15.4% (9,049 v. 7,842). New listings put in some effort to head in the same direction, rising 2.6% (12,777 v. 12,448).

Year-to-Date Trends

Comparing year-to-date figures at the end of September 2003 to the same period in 2002 shows closed sales topped its previous measure by 13.2%. Pending sales rose as well, showing an increase by 11.4%. New listings also managed to climb, up 4.0%.

Cost of Residential Homes in the Portland Metro Area

For Period 9/2003

Area

Average
Sales
Price

***Percent
Appreciated

North

8.0%

Northeast

8.1%

Southeast

Mortgage Rates: Forecast for Stability for Next Few Months

October 30, 2003

In Freddie Mac's Primary Mortgage Market Survey, the 30-year fixed-rate mortgage (FRM) averaged 5.94 percent, with an average 0.6 point, for the week ending October 31, 2003, down from 6.05 percent last week. Last year at this time, the 30-year FRM averaged 6.13 percent.

The average for the 15-year FRM this week is 5.26 percent, with an average 0.6 point, down from last week's average of 5.39 percent. A year ago, the 15-year FRM averaged 5.51 percent.

One-year Treasury-indexed adjustable-rate mortgages (ARMs) averaged 3.74 percent this week, with an average 0.7 point, down slightly from last week's average of 3.76 percent. At this time last year, the one-year ARM averaged 4.25 percent.

(Average commitment rates should be reported along with average fees and points to reflect the total cost of obtaining the mortgage.)

"Gross Domestic Product numbers surprised everyone today, posting a much larger-than-expected increase and confirming the notion that the economy has finally turned the corner," said Frank Nothaft, Freddie Mac chief economist. "Worry about disinflation should now be tempered somewhat, but fear of inflation is still unwarranted. And that should keep mortgage rates from rising too quickly or steeply anytime in the near future."

Third quarter home sales continued to be strong. As long as mortgage rates remain under about 6 ½ percent – last year's annual average – the housing market will remain healthy."

Portland Area Mortgage Rates

In late October, Washington Mutual Bank was offering 5.88 percent for a 30-year FRM (APR of 5.93 percent) with zero points. Another lender, US Bank's rate in early October was 5.95 for a 30-year FRM (APR OF 6.09 percent).  Both of these rates are for a $150,000 loan with 20% down. 

You can learn more about mortgages by visiting Professor Guttentag website.

To check on local mortgage rates go to Bankrate.

Portland Weather
Tracking the Moisture and Sunshine

Water Year:  October 1 - September 30

Portland's rainfall is measured according to the "water year" which is from October 1 through the end of September.  Since we receive only a few inches in the summer months, the rain months are from October through May.  Almost half of Portland's annual rainfall falls in November, December, and January. 

Water Year:  Measurements From Portland Airport Weather Station
 

October Weather

October started off like it wanted to set a record for rainfall and by mid-month, we had doubled the average rainfall up to that time.  Mt. Hood received some snow - Timberline Lodge (elevation 6,000 feet) has 7-8 inches. 

Then the weather gods must have decided they had proved their point so they reversed course, turned off the faucets, and concentrated on setting some "warm weather" records.  And that they did.  We had numerous days in the high 70s and low 80s, breaking warm weather records day after day. 

The end of October brings in cold Arctic/Canada air with temperature lows in the low 30s, about 10 degrees colder than normal.  The high winds accompanying the cold front make it even colder.  It was chilly for the "tricks and treats" kids but drier than many Halloweens in the past.  Instead of parents carrying umbrellas for their children, they dressed them in layers.  The cold didn't deter the kids - we had the normal neighborhood quota of 50-60 young ones.

New Water Year Begins in October

Our water year officially begins October 1st and each month we will post the rainfall and comment on the month's weather.
 

Public Utility District - November 4th Special Election

The November 4th special election, in which Multnomah County voters are being asked to set up a people's utility district with authority to take over the assets of Portland General Electric (PGE), will be decided on November 4th.  In this election, voters will decide the future of public power in Multnomah County.  PGE, an Enron subsidiary  provides power to the city of Portland and other communities within the county.  How it affects PacificCorp, a subsidiary of Scottish Power, is not known at the present time.  PacificCorp supplies power mainly to customers outside of the Portland metro area but does have a few customers in the metro area.

What is a People's Utility District

A people's utility district is a government-owned corporation.  Unlike investor-owned utilities, PUDs don't seek to generate profits.  Among other powers, they have the authority to condemn the property of investor-owned utilities and issue voter-approved revenue bonds to fund acquisition.

David vs. Goliath

Opponents of the PUD are led by Citizens Against the Government Takeover and have the backing of PGE and PacificPower, Oregon's other major investor-owned utility. They are likely to raise close to $2 million. The Oregon Public Power Coalition, which got the PUD proposal on the ballot, has raised about $29,000 to make its case.  Although the organization has the support of the Democratic Party, it has not been able to enlist the support of broad-based environmental and energy groups such as the Sierra Club and Industrial Customers of Northwest Utilities.

PUD advocates also have come up short in a legal wrangle over the 26-52 tax measure to raise $127,000 for a required engineering study.  In mid-October, the 9th U.S. Circuit Court of Appeals blocked an order by U.S. District Judge Ancer Haggerty to correct what he called a "patently misleading" statement in the Measure 26-52 ballot title that the proposal could increase taxes as much as 3 percent.

Three Ballot Items

County voters will vote on three items. 

1. First, the PUD itself - Measure 26-51.  What Measure 26-51 would do, if approved, is establish the Multnomah County People's Utility District and install an elected five-member board of local residents to run it.  They would have the authority to condemn PGE and PacificCorp assets in Multnomah County.
2. Second, (Measure 26-52) whether to impose a levy of .0003 cents per $1,000 of assessed property value, or about 45 cents on a $150,000 home.  This money would be used to study utility acquisition. 
3. Last, voters must select five candidates from a list of twelve to serve on the PUD board.

And my Prediction . . .

After I predicted the passage of the county tax earlier this year, I'm going "out on the limb" and make another forecast.  I predict that the Multnomah County voters will approve a PUD.  Even if my prediction fails, I'm still batting 500.  In baseball that kind of average would make me a superstar.

From a Portland Tribune Article (mid-October)

Jim Moore, an independent political consultant and former University of Portland political science professor says a defeat seems certain.  "Voters are burned out on voting and taxes," he said, which is why he thinks the "new tax" worries that opponents have raised will carry the day.  Brian Gard, whose firm Gard & Gerber is directing the anti-PUD campaign, has little doubt that the voters will defeat the PUD, based on his periodic polls. "Gard said that "...support for a PUD is nowhere near to passing."  He will not release his poll results, however, and the Oregon Public Power Coalition has not commissioned a poll.

The Issues

When this issue was first proposed, I didn't think it stood a chance of passing.  In recent weeks, in talking with many Portlanders, I'm surprised at the response that people give as to the reasons they are voting for a PUD.  Most of the sentiment against PGE stems from the the ownership of PGE by Enron, the bankrupt Texas power company charged with numerous criminal acts.  Another issue is that many of the top PGE officers have been given large retention bonus.  When people write out the check to PGE each month, they realize that a good share of the check is going to Enron and a few PGE officers.  It begins to grind on them over time.

Another reason is the costly anti-PUD campaign may be turning off some voters. This is reminiscent of the Oregon "Death with Dignity" (also called the Assisted Suicide Law) vote a few years ago.  The more money that poured into the state from outside organizations opposing the bill, the more the Oregon voters seemed to support the bill.  As someone said after the election, "If the Catholic Church would have just offered up a few more million dollars, it would have passed by a much wider margin."

Another concern is the fear that Enron, which filed for bankruptcy in December 2001, may sell off PGE's assets in pieces or to another out-of-state corporation.

PUD Would be One of Seven in State

If the measure passes, the Multnomah PUD would be the first set up in five years and the seventh one statewide. If the new PUD moved to take over PGE, as the public power coalition intends -- although the PUD board would decide that -- political experts predict a lengthy legal fight, with Enron likely to be the first to file suit to hang on to its prized asset.

Kitchens & Bath

We just received Fine Homebuilding magazine's annual issue entitled Kitchens & Baths in the mail and want to alert you to this wonderful issue.  The cover story is "Mix and Match: Mail-Order Cabinets" which tells you that the magazine has a practical bend to it.

Two other articles struck my attention.  One about a "Small Kitchen for a Small House on a Small Budget" and the other is "The Thoughtful Bath."  The later uses innovative technology and recycled materials.

It is the only home magazine we subscribe to and one that satisfies both my needs and my husband's.  Mine for the design ideas and his because many of the articles provide detail instructions on "how to do it."

Is Portland Vulnerable to Wildland Fires?

History of Wildland Fires in the Portland Metro Area

August 2001  What started as a routine brush fire along the east bank of the Willamette River almost instantly spread up a steep North Portland bluff Wednesday evening to threaten homes and buildings and become one of the worst urban wildfires in the Portland's history.  All available firefighters -- about 170 -- were called out in five alarms to the University of Portland area. Many stationed themselves between the onrushing flames and endangered homes to help residents who were desperately using garden hoses against flames roaring 30 to 50 feet into the air in their back yards.  The fire was contained and the City of Portland replaced the blackberry bushes, and other highly flammable noxious weeds with less fire-friendly plants such as native grasses.  No homes were lost.

September 2003  A power line problem sparked the 100-acre Herman Creek fire in dry brush beside I-84 about noon on Tuesday, September 2, just east of Portland in the community of Cascade Locks.  The fire broke out when a tree branch fell on the power line, and the line broke off and fell into the grass, officials said.

Despite all odds, a stubborn wildfire fueled by driving east winds largely spared the community of Cascade Locks , but not before decimating three buildings and forcing the evacuation of dozens of homes in the Columbia Gorge town. Winds sent fiery embers up and down the walls of the Oregon Gorge, bringing the fire dangerously close to the town of about 1,140 that sits nestled between the Columbia River and the imposing cliffs of the gorge. Local fire crews were overwhelmed within hours, forcing Oregon Governor Ted Kulongoski to call upon Multnomah County firefighters to help fight the wildland blaze.  The fire was contained and many residents realized how lucky they were to still have their homes intact.

NFPA Wildland Fire Prevention

The National Fire Prevention Association (NFPA) has three sections devoted to wildland fire prevention:

• The Firewise Web site, a project of the National Wildland/Urban Interface Fire Program, offers safety tips, forums, event information, and content for consumers, firefighters, and community leaders.
• Risk Watch®: Natural Disasters is a school-based program that helps children and their families prepare for disasters. A module on wildland fires includes safety basics and instructions on preparing a family disaster supplies pack.
• Outdoor fire safety tips from NFPA´s Public Education division.

You can find these three sections by visiting the NFPA website.  You can Download a free copy of NFPA 1144, Standard for Protection of Life and Property from Wildfire (PDF format). 

The City of Portland's Fire Fire & Rescue Bureau developed an ordinance that addressed a key issue in urban wildland fires - roofing.  Virtually all new composition roofing materials are fire retardant, as well as tile and metal. Untreated wood shake or shingles can also be treated to become fire retardant. The ordinance was reviewed by neighborhood associations, environmental managers, and other stakeholders for feedback, and the City Council passed the ordinance.  You can read their document entitled "What You Can do to Help Prevent Urban Wildland Fire Damage".
 

Timberline Lodge

Timberline Lodge, on the south slope of Mt. Hood in Oregon, is unique in America. It is the only twentieth-century public building of its size constructed and furnished entirely by hand with original craft work in wood (both carved and inlaid marquetry), wrought iron, weaving, applique, painting, mosaic, carved linoleum, and stained glass.

The lodge is an inn, but it is also a museum in the sense that it houses a permanent, catalogued exhibition of American design, painting, and craft work of the 1930's, created under extraordinary circumstances for a special purpose: to furnish and decorate a mountain lodge for skiers, hikers, and nature lovers.

WPA Project

Timberline Lodge was built by hundreds of hands eager to work after months or years of unemployment in the 1930s. Ninety percent of the men and women who built and furnished the lodge were hired by the Works Progress Administration (WPA), the federal agency created in 1933 to provide work for the hundreds of thousands of Americans idled by the Great Depression. The remaining ten percent were foremen employed by Lorenz Brothers, the supervising contractor for the WPA, or U.S. Forest Service personnel. Some of the WPA workers were skilled, such as some of the stonemasons, but others were taught skills to prepare them for jobs in the private sector.

Friends of Timberline

Friends of Timberline are dedicated to the preservation and documentation of the artifacts, furnishings, historical significance, and immediate environs of Timberline Lodge. Friends of Timberline is also dedicated to raising funds and coordinating community volunteer efforts to accomplish these goals.