PORTLAND, Ore. (KOIN) – The Portland housing market was vastly different in November 2022 compared to the year before. 

In just one year, pending sales and closed sales have both plummeted by more than 40% and new listings have decreased by more than 25%, according to the November Market Action report by the Regional Multiple Listing Service. 

While these numbers have dropped, others have risen. The report said the median sale price of homes in the Portland metro area in November 2022 was $525,900. That’s down $11,100 from October 2022, but still $8,100 higher than the median home sale price in November 2021. 

What’s also gone up is home inventory and how long homes are staying on the market. 

In November 2022, inventory increased to 2.6 months. This means if no other houses were listed for sale, the number of available houses would sell within 2.6 months. That’s the highest inventory since September 2019. On average, homes sold in November had been on the market for 44 days, according to the RMLS report. 

The month before, inventory was 2.4. It’s been climbing since August. 

Josh Lehner, a state economist with the Oregon Office of Economic Analysis, said these changes to the housing market aren’t exclusive to Portland; the entire state is experiencing them. 

He said it’s due to rising interest rates pushing homeownership affordability to its worst point in recent decades. 

“In terms of the direct economic impacts, bad affordability hurts household budgets, and reduces volumes of activity when it comes to new housing starts, and existing home sales,” Lehner wrote in a recent post. 

While the situation might seem bleak right now, Lehner expects it will improve. The combination of lower interest rates, rising incomes and falling prices over the next year should bring affordability back to a more normal level. 

In the Portland metro area, Lehner said the latest real estate data from November show that only 19% of households are estimated to be able to afford the monthly payment on the median home sold, which was $525,900 in November. That’s a decline of 131,000 households, or 32%, since the start of the year. 

This chart created by the Oregon Office of Economic Analysis shows how many households in Portland can afford the monthly median sale price of a home with a 5% down payment and total housing costs not exceeding 30% of their income.

In Bend, Lehner said the affordability looks better than previously estimated based on the updated incomes. He said incomes have risen in the area, which means more local households can afford housing. 

In Bend, currently, Lehner said 14% of households can afford the monthly payment on the median price of a home sold in November. It’s a decrease from 23% at the start of the year. 

Salem is seeing a situation where only 22% of households can afford the monthly payment on the median home sale price, compared to 38% at the start of the year, according to data from the U.S. Census Bureau and the Willamette Valley Multiple Listing Service. 

In the Oregon portion of the Portland metro area in November 2022, the region with the lowest median home sale price was Columbia County at $427,500. 

In Southwest Washington, the lowest median home price was in the Felida area of Vancouver at $391,000.