Regardless of how you feel about Oregon’s land-use planning system, the announcement last night that Metro envisions no expansion of Portland’s urban growth boundary to accommodate an anticipated one million additional people by 2030 is probably surprising. But Metro has done its homework, and development interests will need to marshal all their resources to counter it. As reported in this morning’s Oregonian, Metro says Portland has room to grow inside the current urban growth boundary.

Metro’s announcement and report formally opens a 30-day public comment period featuring seven open houses and five public hearings. Metro is scheduled to adopt a regional transportation plan and an urban growth report, which will formalize population and job projections, by the end of the year. Designations of urban and rural reserves are scheduled for next summer. A Guide to Making the Greatest Place is a concise, downloadable summary with timelines and meeting schedules prepared by Metro.

The “takeaway” for those of us in the close-in neighborhoods: good homes in convenient locations will become more valuable and outperform the general market.

NAR reported this morning that the monthly number of existing home sale contracts has risen for six straight months, the first time that has occurred since the Pending Home Sales Index was created in 2001 (the base year in which the index equals 100). July’s value of 97.6 was the highest single month since June 2007, when the index reached 100.7. In the West the index jumped to 112.5, and is 20.0 percent above July 2008. Note that this index measures the number of pending sales, not price changes.

Why has the Pending Home Sales Index jumped? The professional consensus is that falling prices and low interest rates have dramatically increased housing affordability, and the first-time buyer tax credit has further stimulated the number of sales. Nationally, the typical mortgage payment now takes less than 25 percent of “median family income” to buy a “median priced home.” People are buying while both prices and rates are low because they can and because many think the bottoms of their markets have passed. NAR also estimates that 1.9 to 2.0 million buyers will take advantage of the $8,000 first-time buyer tax credit this year, 350,000 of whom would not have bought without it. The number of sales is up and the unsold inventory is down nationally, regionally, and in Portland.

Portland home buyers qualifying for Federal Housing Administration-insured mortgages may soon use the new $8,000 first-time home buyer tax credit as a down payment, US Department of Housing and Urban Development Secretary Shaun Donovan said Tuesday.

The FHA will allow approved lenders, non-profits, and state and local governments to fund short-term bridge loans to be used for down payment funds by borrowers eligible to claim the home buyer tax credit. The borrowers will then repay the loans after getting their tax refunds.

The FHA requires a minimum 3.5% down payment on loans backed by the agency. Details on the initiative will be released next week.