If you’re a landlord in the Portland Oregon area, you may be concerned about what to expect this year in terms of the economic outlook because it’s also an election year and there is a lot of talk about financial reform among the Presidential candidates.
In this article, we will share with you several predictions for the economic outlook you can expect in 2020.
As of January 2020, the Portland jobs market remains steady and most economists predict that the PDX area will add the same amount of jobs as it did in 2019.
The good news is that the PDX jobs market continues to experience near full employment, and with more companies adding new jobs on a weekly basis, there should be plenty of good job opportunities for PDX residents including people who are relocating to the Portland area.
Rental Demand Remains High
Another benefit to owners in the PDX area is that demand for rental properties here remains high since Portland continues to be a top relocation destination in the United States.
The average rent for a 765 square foot apartment in the Portland area is $1,536 per month.
The most affordable neighborhoods in Portland are Cully, where the average rent goes for $779/month, Parkrose, where renters pay $1,006/mo on average, and Parkrose Heights, where the average rent goes for $1,006/mo. If you’re looking for other great deals, check out the listings from Sumner ($1,006), Woodland Park ($1,006), and West Centennial ($1,155), where the asking prices are below the average Portland rent of $1,536/mo.
The most expensive neighborhoods in Portland are Nob Hill – Northwest District ($1,862), Old Town Portland – Chinatown ($1,901) and The Pearl ($1,914).
The most popular neighborhood in Portland is Nob Hill – Northwest District, where there are 22 verified RENTCafé listings with an average rent of $1,862. Next up is Downtown Portland, where apartments go for $1,698/month, followed by The Pearl with $1,914 If you’re looking to rent in Portland’s most popular neighborhoods, make sure to also check out Buckman, where renters pay $1,537 on average, and Kerns, where the average monthly rent is $1,576.
Source – rentcafe.com
Vacancy Rates Will Hold Steady
With a strong rental market in 2020, we can also expect vacancy rates to hold steady as well at close to 2.3% for the year, reflecting the national average.
As in previous years, we’re continuing to see people renting from all generations including Millennials, to Baby Boomers, due to their economic responsibilities and the overall desirability that renting vs. home ownership.
Home Inventory Will Remain Tight
Are you planning on funding new rentals to your portfolio of PDX rental properties in 2020? If so, home inventory will remain tight but don’t let that stop you from finding deals because you may be able to find a variety of off-market rental properties if you’re searching for them.
To find off-market rental properties it’s best to consider strategies like “driving for dollars”, networking, using online resources to check public records, direct mail marketing, or working with a local Real Estate agent.
Mortgage Interest Rates Will Remain Low
When we started 2019, there was talk that mortgage interest rates would finally climb to 5%. That didn’t happen. Interest rates stayed low all year long and that trend is expected to continue in 2020 as well.
Since 2020 is also another Presidential Election year, and with the economy in a fragile state, it’s expected that both parties will be eager to keep the economy moving forward as is until after the elections are over.
Greg McBride, CFA, Bankrate chief financial analyst, predicts mortgage rates will stay relatively stable around 4 percent in 2020.
“The benchmark 30-year fixed-rate mortgage will hopscotch back and forth over the 4 percent mark for much of 2020, remaining low enough to facilitate home buying and providing ample refinancing opportunities on those trips below 4 percent,” he says.
Inflation is something borrowers should watch for, especially toward the end of 2020, McBride says. Core inflation, as measured by the Fed’s PCE Index, will top out at 2.2 percent, he predicts, which will likely keep the Fed muted on rate hikes.
“Rates will trend higher toward the back half of the year as inflation readings move above 2 percent.”
Source – Bankrate.com
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