The Regional Multiple Listing Service reported that the number of closed sales in 2009 was down 0.9% from 2008 (18,955 vs. 19,132). That sounds okay.

Compared to the previous six years, however, Portland home sales were down a lot more than that. Total closed sales in 2009 were 63% of the average annual number of closed sales in the years 2003 through 2008. To avoid an overwhelming display of numbers, you can sense this phenomenon in the bar chart below (contact me if you want the raw data).

It’s also noteworthy that the mix of sold homes stayed fairly consistent through the years. The two pie charts below are different. The first illustrates the percentage breakdown of total sales in Portland by number of bedrooms from 2003 through 2008; the second 2009 only. No house type varied by more than one percent in 2009 from the average of the previous six years.

This result is counter-intuitive to me, and certainly contrary to the current conventional wisdom. This nearly constant mix of sold homes in 2009 happened despite: 1) the huge drop in total sales, 2) the difficulty in getting jumbo loans since late-2008 (generally thought to have slowed large home sales), and 3) the effect of the first-time home buyer tax credit (generally thought to have stimulated small home sales).

Why?

I don’t know. Here is my knee-jerk hunch, to be refined after much more mulling: People buying a home need (or at least want) a certain range of space and rooms, sometimes less, often more. Two people don’t usually buy four-plus bedroom homes; young families don’t usually buy two bedroom homes. Both will buy the size they need at a price they can pay. So assuming that the need for various size homes is relatively constant, it’s reasonable that the mix of homes purchased could also be constant.

That leaves the main variable on the demand side to be the price buyers can afford. That price is influenced primarily by employment and interest rates, and secondarily by wealth, in the form of down payment funds, and mortgage availability. Yesterday I showed that Portland home prices had fallen fairly evenly across these same home size categories. Perhaps the impact of these factors is more evenly distributed across buyer profiles than we thought.

I have a hunch that a deeper look into the 2009 home sales in each size category will reveal some good clues. More later.

What about the supply side? I’ll post on that tomorrow.

Visit the Portland Home Team’s Market Data Center for other current measures, or call or email us for up-to-date information about your home.

Portland Housing Market: 2009 Review, 2010 Forecast

• Monday – 2009 Portland Home Sale Prices: RMLS releases annualized 2009 data for Portland metro and sub-area markets.
• Tuesday – 2009 Portland Home Sale Totals: What type and size homes have suffered the most?
• Wednesday – Active Listing Inventory: Is it true that Portland is flooded with “For Sale” signs?
• Thursday – 2010 Forecast: What we think it all means for the market value of your current or future home.
• Next Week – Opportunities in 2010: There are unbelievable bargains out there, but they’re not obvious.