Blog Stories The Market in Focus: Interest Rates & the Portland Housing Market

The Market in Focus: Interest Rates & the Portland Housing Market

By Aryne + Dulcinea, March 6, 2018

By Aaron Nawrocki, Capital M Lending

It’s been an exciting 2018 so far in the stock and bond markets. The broad indices are down over 10% from their peaks. Treasury Bond and mortgage rates are at a four-year high. It may be a good time not to look at your 401k statements, but what about the effect on home prices and the Portland housing market?

Higher interest rates make homes more costly, even if prices don’t rise. The higher cost of borrowing generally slows price increases. If we looked back over the last 20 years, we’d see a general correlation between rates rising and prices stalling. Mortgage interest rates are up about .5% over the last month, and for the average Portland homebuyer that means an increase in monthly payment of about $150. That’s enough to slow appreciation down somewhat and that’s exactly what the Fed hopes to accomplish with their rate increases.

Is it the second coming of 2009? Not likely. Interestingly enough, a moderate increase in borrowing cost can slow price increases, but rarely does it dramatically slow the market. Buying a home is a serious decision and typically the largest single financial transaction a family will make. Most buyers make the decision to buy a home based on their financial prospects and choose the price based on the monthly payment. So, interest rates don’t necessarily keep folks from buying, but they do affect the price they are willing to pay. We have a growing economy with a shrinking middle class (that’s a discussion for another day) and many Americans feel confident about their jobs and prospects. That confidence is what make buyers feel comfortable about buying homes (and is much more important than interest rates in the buying decision.) We learned this during the recession. Lower interest rates and lower mortgage payments don’t bring buyers in from the sidelines if they are worried about their jobs.

As the Fed works to smooth out and proactively dampen the economic cycle, watch for a brief slowdown while buyers and sellers receive and react to rates. Once the new normal for interest rates is accepted by the Portland housing market, it’s likely we’ll see buyers continue to enter the market. Portland is a desirable destination and still affordable for many potential homebuyers. We’ll see if the rate changes are a correction or a sign of things to come. For now we expect robust sales and a healthy market balanced between buyers and sellers.


Aaron Nawrocki has over 20 years of direct experience overseeing mortgage and loan processes, working to provide clients the market insight and lending expertise required to make informed decisions.


About Us:
Over the course of their professional partnership, Aryne + Dulcinea have helped over 200 clients prosper in their new lives. During this time, they have prided themselves in their top-notch selling abilities, with homes outperforming market standards, consistently exceeding list price while most of their listings sell in under 7 days. Whether you’re looking to buy or sell, Aryne & Dulcinea will work in collaboration to guide you in investing in your future and reaching your real estate goals.

Aryne + Dulcinea

Earth Advantage Principal Broker | Earth Advantage Broker | ADU Specialists | OR


Click here to get to know Aryne + Dulcinea!

Aryne + Dulcinea are full-service, high-producing agents, who understand how to navigate the unique challenges facing the Portland real estate market. The secret to their success is in their professionalism and complementary skill sets. In 2012, Aryne + Dulcinea saw an opportunity to combine their creative and technical wisdom to create a values-driven, full-service agency unlike any other. Expert negotiators and project management mavens with a strong background in creative marketing, Aryne + Dulcinea serve as fierce advocates for their clients. 

Their passion for real estate relates closely to their commitment to the Portland way of life, which entails a dedication to sustainability and appreciation for all things local. As Earth Advantage Brokers and ADU Certified Specialists, Aryne + Dulcinea are savvy in all aspects of alternative living practices—from versatile housing additions, green building practices, and revenue-generating strategies. Whether you’re looking to buy or sell, Aryne & Dulcinea will work in collaboration to guide you in investing in your future and reaching you real estate goals.

Aryne greets working with clients throughout Portland with open arms. Licensed since 2005, she appreciates the ever shifting desires her clients have as they move through their real estate goals. Investigative genius on her side, Aryne will strive to bring you the results you desire.  When not working for you, Aryne is a constant cheerleader for her son and daughter’s pursuits on the basketball court and on the ballet stage! She practices yoga, hikes, loves to walk and explore Portland neighborhoods, reads, and delights in soaking up everything Portland has to offer! 

Dulcinea thrives on working with clients with a range of real estate goals.  Oregon born, with a design and an award-winning professional background, Dulcinea is steadfast when it comes to working for her clients and has a keen eye for properties that best serve client objectives. Licensed since 2013, Dulcinea works in and around Portland.  A mother of two and wife to her high school sweetie—in her free time she stays busy with her family, travel, community activism, exploring the outdoors, curating art shows, and dreaming big!

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