Friday’s Jobs Report from the Bureau of Labor Statistics was a big market mover, showing that 80,000 jobs were created in October, which was just slightly below expectations. In addition, 104,000 private sector jobs were created, also just below expectations while the unemployment rate dropped to 9%, from a previous reading of 9.1%.A big positive in the report was once again upward revisions to prior month’s readings, which showed 102,000 more jobs created in the two previous months than what was originally reported.

The takeaway from the report is that it doesn’t appear the economy is slipping into another recession…at least not yet. The labor market continues to create jobs, but at a very slow and uneven pace. Until we see significant job growth–north of 150,000 each month, for a sustained amount of time–we won’t see meaningful improvement in the economy or the unemployment rate. This turn means that rates should continue to hover at low levels, albeit in a volatile fashion.

Also limiting how high our rates can go is the ongoing European drama. The removal of the referendum (Greek Prime Minister George Papandreou had announced he would put the Euro rescue plan to a referendum or vote amongst the Greek people) is one piece of uncertainty taken away from the market–and that was a big one. However, there are still so many things that can and probably will go wrong until the European leaders put a big, realistic, attainable solution into action. For instance, Italy’s Bond yields continue to inch higher, suggesting that their debt problems won’t easily be solved and continue to creep towards an unmanageable state.

Plus, Fed Chairman Ben Bernanke said Wednesday during his speech after the regularly scheduled meeting of the Federal Open Market Committee that purchases of Mortgage Bonds are being considered–which is another factor that could benefit home loan rates.

Here are mortgage rates for the beginning of this week….

 Conventional 30 Yr. Fixed:  3.95%

Conventional 15 Yr. Fixed:  3.875%

Conventional 5/1 ARM: 2.75%

FHA/VA 30 Yr. Fixed:  3.75%

FHA/VA 5/1 ARM:  3.50%

Jumbo 30 Yr. Fixed:  4.625%

Jumbo 5/1 ARM:  2.875%

Forecast for the Week

While the Stock Markets are open Friday, the Bond Market will be closed in honor of Veterans Day. And with fewer economic reports this week–and with earnings season essentially behind us-the Bond Market will take direction from a number of factors.

•The first major report will be released on Thursday when Weekly Jobless Claims are reported. Last week’s report showed that weekly claims fell below 400,000 to 397,000, which was better than the 401,000 that was expected.

•The markets will also get a new read on how American consumers feel about the economy with the Consumer Sentiment Index on Friday.

In addition to those reports, the headlines coming out of Europe will continue to influence the markets here in the US, including Bonds and, as a result, home loan rates. Also, this week’s Treasury auctions totaling $72 Billion could be a big market mover, depending on how they’re received.

Remember: Weak economic news normally causes money to flow out of Stocks and into Bonds, helping Bonds and home loan rates improve, while strong economic news normally has the opposite result.

Bonds and home loan rates were able to take advantage of the decrease in Stocks last week, due in part to the uncertainty out of Europe. I’ll be monitoring this situation closely in the weeks ahead.

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September Residential Highlights

Sales activity in the Portland Metro area showed improvements in closed and pending sales this September compared with September 2010, and the inventory level remained much lower than the same month in 2010. Closed sales grew 13.4% in September 2011 compared to September 2010. Pending sales were also up 17.5%, and new listings dropped 29.5%. Comparing the previous month of August 2011 with September 2011, closed sales decreased from 1,805 to 1,586 (-12.1%). Pending sales also went down from 2,187 to 1,861 (-14.9%). New listings fell from 2,879 to 2,501 (-13.1%). At the month’s rate of sales, the 10,666 active residential listings would last about 6.7 months.

Sale Prices

Average sale price for September 2011 declined 4.2% compared to September 2010. Median sale price also fell 3.8%. Month to month, comparing August 2011 to September 2011, sale price activity was mixed. Average sale price went down from $271,800 to $268,200 (-1.3%) while median sale price increased from $225,000 to $230,800 (2.6%).

Third Quarter Report

Comparing the third quarter of 2010 with that of 2011, sales activity was up. Closed sales jumped up by 21.5% (4,340 v. 5,275), while pending sales also increased by 21.6% (4,725 v. 5,747). New listings fell 27.6% (11,582 v. 8,380). In the same quarterly comparison, average sale price fell 6.9%, while median sale price dropped 7.5%.

NORTH PORTLAND —-
Previous Month’s Average Sales Price: $222,700.
Year-to-Date Average Sales Price & Appreciation: $221,400, -4.5%.

NORTHEAST PORTLAND —-
Previous Month’s Average Sales Price: $249,200.
Year-to-Date Average Sales Price & Appreciation: $267,800, -5.5%.

SOUTHEAST PORTLAND —-
Previous Month’s Average Sales Price: $216,100.
Year-to-Date Average Sales Price & Appreciation: $214,400, -8.1%.

WEST PORTLAND —-
Previous Month’s Average Sales Price: $399,100.
Year-to-Date Average Sales Price & Appreciation: $392,100, -2.2%.

BEAVERTON —-
Previous Month’s Average Sales Price: $232,100
Year-to-Date Average Sales Price & Appreciation: $212,200, -13.0%.

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People say that “life is full of surprises.” And indeed, last week’s Jobs Report contained several surprises. Read on to find out if they were good or bad…and what they meant for home loan rates.

Overall, the Jobs Report wasn’t great, but it did surprise by being better than anticipated. One thing that wasn’t a surprise was the unemployment rate which held steady at 9.1%. But the headline number came in at 103,000 jobs created, which was better than expectations of 60,000 and even higher than some of the more frothy expectations. In addition, 137,000 jobs were created in the private sector, which offset more government job losses and which was a lot better than the 83,000 private job gains expected.

Another surprise in the report was the significant upward revisions, which added 99,000 jobs to what was previously reported in prior months, and this added to the positive tone of the report. These upward revisions really change a very pessimistic jobs picture to something a bit more optimistic. For instance, last month the Jobs Report showed zero job creations and now that figure has been revised to show 57,000 jobs created. Once again, these aren’t great numbers—but they are better than bad, and they tell us that the economy is not in a recession…at least for now.

So, what did all of this mean for home loan rates? It’s important to remember that when our economy is struggling, our Bond Market usually benefits as investors seek a safe haven for their money. And since home loan rates are tied to Mortgage Bonds, our home loan rates are sometimes at their best when our economy is struggling. In a way it makes sense…in times of economic struggle, good home loan rates can help kick start our economy in other areas.

Yet, when good or better than expected economic news hits the wires, like it did with Friday’s Jobs Report, investors often move their money out of Bonds and into Stocks in an attempt to take advantage of these gains. And that’s a big reason why we saw Bonds and home loan rates worsen a bit this week.

As of today (Thursday, October 13th) rates are still great:

Conforming

30 year fixed: 4.125%

15 year fixed: 3.50%

5/1 ARM: 2.875%

7/1 ARM: 3.375%

Government

30 year fixed: 3.75%

5/1 ARM: 3.50%

Jumbo

30 year fixed: 4.875%

5/1 ARM: 3.25%

The most important thing to remember is that now is still a great time to purchase or refinance a home, as home loan rates remain near historic lows.

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Sales activity in the Portland Metro area showed improvements in closed and pending sales this August compared with August 2010. Closed sales grew 30.7% in August 2011 compared to August 2010. Pending sales were up 29.6%, and new listings dropped 24.8%. Comparing July 2011 with August 2011, closed sales increased from 1,709 to 1,805 (5.6%). Pending sales also went up from 1,928 to 2,187 (13.4%). New listings went down from 2,942 to 2,879 (-2.1%). At the month’s rate of sales, the 11,276 active residential listings would last about 6.2 months.

Sale Prices

Average sale price for August 2011 declined 9.2% compared to August 2010. Median sale price also fell 10%. Month to month, comparing July 2011 to August 2011, sale price activity fell slightly. Average sale price went down from $275,100 to $271,800 (-1.2%) while median sale price decreased from $227,200 to $225,000 (-1%).

Year-to-Date

Comparing January-August 2010 with the same period in 2011, results were mixed. Closed sales decreased by 0.5% (13,185 v. 13,114), while pending sales increased by 2.8% (14,248 v. 14,645). New listings fell 26% (34,043 v. 25,189).

NORTH PORTLAND —-
Previous Month’s Average Sales Price: $246,100.
Year-to-Date Average Sales Price & Appreciation: $221,100, -4.7%.

NORTHEAST PORTLAND —-
Previous Month’s Average Sales Price: $282,900.
Year-to-Date Average Sales Price & Appreciation: $270,300, -4.4%.

SOUTHEAST PORTLAND —-
Previous Month’s Average Sales Price: $232,600.
Year-to-Date Average Sales Price & Appreciation: $213,900, -7.2%.

WEST PORTLAND —-
Previous Month’s Average Sales Price: $394,900.
Year-to-Date Average Sales Price & Appreciation: $390,300, -2.5%.

BEAVERTON —-
Previous Month’s Average Sales Price: $217,600
Year-to-Date Average Sales Price & Appreciation: $209,600, -12.5%.

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Amid a sea of negative headlines, there is a hint of good news in the latest Portland area housing report: a small uptick in the median sale price of homes sold in July.

The Regional Multiple Listing Service said in its monthly market action report that the median home sale price in July was $227,200. Granted, that’s a decline of 7.6 percent from a year ago, but it represents a 1.9 percent improvement from June’s $222,900 figure.

Click on the link below for the full story

http://www.oregonlive.com/business/index.ssf/2011/08/home_prices_edging_up_in_portl.html

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Portland Farmers Market is a collection of six vibrant farmers’ markets held in unique urban locations throughout the Portland metro area. While each location has its own personality, all six markets provide a direct connection to the agricultural abundance of our region and serve as gathering places in which to grow, nourish and inspire community.

My favorite is the PSU market, it is the biggest I have been to. It has everything from specialty cheese, fresh fruits and vegetable’s, all kinds of meats, eggs, yummy food and much much more.

Click on the link below for more information on all the farmers markets in Portland

http://www.portlandfarmersmarket.org/index.php/markets

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Thinking of moving? Ready to buy? Just curious? Our comprehensive guide to 95 Portland neighborhoods and suburbs lets you compare the data you need to know. This guide will answer all your questions and help you with any decisions you have regarding your move or current neighborhood.

Just click on the link below for more information.

http://www.portlandmonthlymag.com/real-estate/articles/neighborhoods-by-the-numbers/

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Tags: Portland Neighborhoods

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WASHINGTON (AP) - Home prices rose for the second straight month in most major U.S. cities and are stabilizing after years of declines. But analysts say the trend in prices hardly signals a rebound for the troubled housing market.

A flurry of spring buyers is helping boost sales. At the same time, millions of foreclosures are in limbo, awaiting the results of a government investigation into improper practices by mortgage lenders. Once that probe is complete, banks will resume seizing homes and prices will likely fall again.

The Standard & Poor’s/Case-Shiller home-price index released Tuesday showed that prices rose in May in 16 of the 20 cities tracked.

Boston, Minneapolis and Washington posted the biggest monthly increases. Prices in Detroit, Las Vegas and Tampa, Fla. - three cities hit hardest by the housing crisis - fell to their lowest points since the recession began.

Price declines have been getting smaller through the year. Seasonally adjusted prices have fallen a modest 1.2 percent over the past six months, according to the index. That’s roughly a third of the decline from the previous six months.

But analysts say the weakening job market and the uncertainty over foreclosures could lead to deeper price declines in the second half of the year. They estimate prices will fall another 5 to 10 percent by year’s end.

“The aggregate economy is at a turning point and there is much uncertainty now,” said Robert Shiller, a Yale professor and co-founder of the home-price index.

David M. Blitzer, chairman of S&P’s index committee, said the month-over-month increases in May were attributed to a “seasonal period of stronger demand for houses.” Such increases are expected, he said.

After adjusting for seasonal factors, such as spring buying, prices fell in 11 markets.

“Sustained increases in home prices over several months and better annual results need to be seen before we can confirm a real estate market recovery,” he said.

Over the last 12 months, prices have fallen in 19 of the 20 cities tracked.

Housing remains the weakest part of the economy. High unemployment, larger down payment requirements and tighter credit are preventing many buyers from entering the market. Many who can afford to buy are waiting because they are worried prices have yet to hit bottom.

Foreclosures and short sales - when a lender agrees to sell for less than what is owed on a mortgage - made up about 30 percent of all home sales last month, up from about 10 percent in past years. And 1.7 million potential foreclosures are being held up, according to real estate firm CoreLogic, either by backlogged courts or lenders awaiting state and federal probes into troubled foreclosure practices.

At least 10 percent of homeowners are 90 days or more past due on their mortgage payments in nine major U.S. cities, according to CoreLogic. The national average is 7.4 percent.

Most of those areas are well known trouble spots, including Atlanta, Las Vegas, Phoenix, Tampa, Fla., and Riverside, Calif. But others haven’t been as battered, including Chicago, Orlando, Fla., Long Island, N.Y., and Sacramento, Calif. That suggests the weakness in the housing industry is nationwide, economists say.

“We’re just really bouncing along the bottom right now,” said Chris Christopher, senior economist at IHS Global Insight. “Even with the positive news, there’s nothing very meaningful in these reports to show we’re coming back up. It’s just little blips here and there.”

There’s also less demand because the U.S. is seeing a decline in household formation. Fewer people are getting married. More young people are moving back in with their parents. Fewer immigrants are coming to the United States, partly because of the economy and also because of tougher enforcement of immigration laws. And the divorce rate has dropped, which is good for families but means there are fewer buyers.

Before the recession, between 2002 and 2007, roughly 1.3 million households were formed every year, according to U.S. Census data. That figure peaked in 2007 at more than 1.6 million. But since then it has fallen to just 357,000 last year, the lowest level in more than 60 years.

One bright spot in the S&P/Case-Shiller data: Even when adjusted for seasonal factors, month-over-month prices rose in some markets that had been pummeled by slumping sales. Those cities are Chicago, Denver, Miami, Minneapolis and Seattle.

The index measures prices compared with those in January 2000. It then provides a three-month average. The May data is the latest available.

FOX12

By DEREK KRAVITZ
AP Real Estate Writer

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Tags: Portland Real Estate Market

If you are wondering what investment properties are doing in the area, here are the July numbers for 2-4 unit properties sold (NW Washington County, Portland West, Aloha, Beaverton, Tigard, Tualatin, Sherwood, Wilsonville).  With prices low and interest even lower, now is a great time to consider investing in real estate. I am licensed in the State of Oregon and would love to help you find the right property!

2 to 4 Units in RMLS Areas 148,150,151 Sold in July, 2010
Area 148             # of units       Address                               List Price    Sale Price  SP/LP Ratio  DOM
                                    2               8012 SW 19th Ave.PDX     329,800$  224,000$   67.9%          1027
                                    4               3511 SW Corbett PDX       385,000$  320,000$   83.1%           58
                                    4               2401 SW 11th PDX            336,600$  325,000$   96.6%          39
                                    4               8101 SW 34th Ave PDX     448,888$   400,000$  89.1%          235

Area 150           # of units        Address                                List Price    Sale Price  SP/LP Ratio DOM
                                    2             6275 SW Fisher Ave. BV     329,000$   303,000$  92.1%          112
                                    3             6955 SW King Blvd.  BV      345,000$   309,000$  89.6%           75

Area 151           # ofunits        Address                                  ListPrice     SalePrice   SP/LPRatio DOM
                                    2            12348 SW Grant Ave. TI      109,000$    90,000$   82.6%             9

Source: RMLS Data, Portland, OR 8/10/2010 DOM=Days on Market

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Tags: Portland Real Estate, Real Estate Investment