Booming Wilsonville housing market could be double-edged sword
In 2008, Wilsonville's booming housing market — along with the rest of the U.S. — collapsed. A decade later, it appears to have fully recovered.
Shortly before the housing bubble burst, the stock market crashed and the worldwide economy went into a deep recession, the median home price in Wilsonville was $406,300, according to Zillow.com. That number cratered to $379,300 by 2008 and $295,500 by 2010.
But housing prices have slowly trended upward since 2012. And in 2017, Wilsonville's average home sales price surpassed the 2007 mark for the first time, according to Zillow — reaching $434,850 in 2017 while Realtor.com calculated the figure at $433,483.
According to Andy Green of Green Group Real Estate, which is based in Wilsonville, the market has continued to rise in the Portland metro area because demand for housing currently exceeds supply.
"There's just not enough inventory at current pricing to be able to fill the demand for buyers," he said.
But for the City of Wilsonville, rising real estate prices could be a double-edged sword.
"It's good to have a strong housing market and making sure you can continue to have a good place to live but if values rise too high there are concerns about whether the average family can afford to live in the city," Wilsonville Planning Manager Miranda Bateschell said. "It's really important that we provide housing for all stages for a person's life."
Bateschell and real estate broker Debi Laue of The Laue Team believe Portlanders who can no longer afford to live in the increasingly expensive city often move to Wilsonville and other neighboring cities.
"Especially for people who are starting a family, it's really difficult to afford a three or four bedroom home in Portland. Not that housing is cheap anywhere, (but) it's cheaper in Wilsonville, along with great schools and a great community to live in," Bateschell said.
However, Laue says, if the current trend continues, Wilsonville could become unaffordable for most homebuyers.
"Maybe people will be priced out and have to go to Canby or Aurora or Newberg but right now it's still very affordable," she said.
To account for the ballooning prices, the City of Wilsonville will conduct an equitable housing study this year, which will assess the cost and variety of the city's current housing stock.
"We want to make sure there are housing for all income brackets. If the prices start rising too high in comparison to income that's something we would need to be concerned of," Bateschell said.
However, though the Great Recession was a disaster for real estate agents, the rise since has been a boon to the profession.
Green lost his job running the sales and marketing center at Villebois Village Center following the financial crisis. But by 2012, after working for a small brokerage in Portland, Green started Green Group's Real Estate's Wilsonville branch. He has since benefited from the burgeoning market and his branch recently moved to a bigger location across the street from World of Speed to manage the growth. Along with the increase in value, Green says developers are building bigger homes in Wilsonville now than in 2011.
"For the most part I've watched the market consistently grow since 2011, with a few minor blips along the way," Green said.
Laue saw a slew of agents and builders leave the market after the Great Recession.
"It had a catastrophic effect on building-related business for about four years," she said.
Since then, Laue says low interest rates have facilitated the rise in prices.
"There was a lot of dead years where people wanted to buy and couldn't, but with low interest rates and affordability, the market has cut loose," she said.
But Bateschell's impression is that young people are struggling to purchase their first home more than they did prior to the collapse of the housing market.
"Getting into your first home nowadays with the increase in college costs and downpayment requirements, that's an area we see people struggle with," Bateschell said.
Green says Green Group Real Estate does about 50 percent of its business in Wilsonville and that the Villebois neighborhood has particularly been a boon for agents. Laue agrees and says the variety of housing in Villebois, from estate homes to townhouses, has provided variety for consumers.
"I think the biggest change has been Villebois; it has brought all kinds of new opportunities to people," she said.
Now that Villebois has mostly filled out, Frog Pond is the next money pot on the horizon.
"The amount of homes we'll see in Frog Pond will make an impact and be an opportunity for the consumer," Green said.
But the uptick in real estate prices won't last forever. And Green has been waiting for an eventual downturn.
"We're long overdue for a market correction," Green said.
"I think the market will correct. It always does. If interest rates go up and prices go up and become unaffordable, they'll come down and be affordable," she said.
Counterintuitively, Green is looking forward to a turn in the market.
"Do I get paranoid? Absolutely not. I'm excited for a shift in the market because I think it's needed," Green said. "The agents with less skill will move out of the market and the ones working on their skill, getting better at their craft, they will be perfectly positioned to take advantage."