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Is it your imagination that it’s hot out there? Nope, this is especially true of the real estate market in north Clackamas County.


“In 23 years I’ve never seen a market this competitive,” said Debra Mathews, a real estate agent with Hasson Company Realtors. Mathews sells houses in Clackamas County and other regions of Oregon.

PHOTO BY: RAYMOND RENDLEMAN - Steven Berglund shows off the 1,066-square-foot house on River Forest Road in Oak Grove owned by his 88-year-old mother, Ingrid.When houses in Portland grow too expensive, the market in the suburbs can become more competitive, like it is now, because potential buyers will start looking at more affordable property outside the city.

People are willing to make longer commutes into the city from the suburbs because they can get more land and house for their money. For some, the smaller, quieter communities also are appealing.

This is the case for north Clackamas County. Just a few years ago, potential buyers would not look at properties in areas like Milwaukie, but now, Mathews said the location is a hot spot.

PHOTO BY: RAYMOND RENDLEMAN - Steve Berglund puts the final touches on the landscaping before his mother's house went on the market.Real estate agent Laurie Sonnenfeld attributes the quick sales to lots of “pent-up demand” for homes, which will take time to satisfy. And although it’s a seller’s market, many are wary of putting their house on the market because it could be hard to buy a new one.

The combination of high demand and few sellers means Mathews has “just over a month’s worth of inventory, which is basically negative inventory,” she said.

One of the properties Mathews recently represented is a 1,066-square-foot house on River Forest Road in Oak Grove owned by Steven Berglund’s 88-year-old mother, Ingrid. Just a year ago, Berglund was a buyer looking for a house for his mother. They purchased a home in the quiet Oak Grove neighborhood with a view of the lake across the road. Now, Berglund’s mother has moved to a retirement community and Mathews is helping her sell the house. Berglund estimates he put about three weeks of full-time work to prepare the house and its large yard. Asking $369,900, he hopes to break even with the amount his family bought the house for and the money they spent on improvements.

At the end of the house’s first week on the market, Berglund and Mathews had two offers.

Seller’s market

Sonnenfeld said she routinely sees multiple offers on a home within a few days of being put on the market. Offers on properties priced appropriately can climb from 5 to 10 percent above the originally asking amount and sometimes more. But just because a lot of people are bidding on one property does not mean Realtors can price homes at exorbitant rates. Sonnenfeld and Mathews agree there’s an art in pricing, and they still have to be careful.

“Buyers are also becoming a little more conservative and looking at recent comparable sales,” Mathews said.

Sellers also must be aware that bidders may offer more money in the heat of the moment than they can actually afford. So homeowners must consider second and third offers in case the most preferred one doesn’t go through.

Sonnenfeld and Mathews both recalled their clients’ frustration and disappointment after watching homes prices soar out of budget. But Oregon is still affordable for out-of-state buyers who come from much more expensive markets.

Some current locals are worried that pressure from new residents priced out of city houses will change their suburbs for the worst.

So what makes Clackamas County attractive to buyers moving from Portland or other cities?

TriMet’s new light-rail line is one recent development that makes suburbs more appealing to people who don’t want to drive into the city all the time.

“Milwaukie is a first-tier suburb as people are being priced out of Portland,” said Grady Wheeler, the city’s public affairs coordinator. He identifies the Moving Milwaukie Forward project to revitalize the downtown commercial district and increased public interest in community events as ways the city is thinking about its future potential.

In 2012, the six-mile Trolley Trail opened along a retired streetcar line to link Milwaukie and Gladstone. It provides a scenic recreational space that appeals to bikers and families.

Sonnenfeld spoke fondly of the River Forest Road neighborhood where Berglund’s house is located. More broadly she believes Oak Grove is an area on the rise.

“There are monthly potluck groups and neighborhood parades, block parties and art walks. Many of the locals put in lots of volunteer work on planning and making the Park Avenue light-rail station beautiful. All of these kinds of community-building activities contribute to the desirability of a neighborhood, and thereby increase the values of homes in the area,” Sonnenfeld said.

OC also hot

To the south, Oregon City’s housing market also is rising quickly. The waterfront development of the closed Blue Heron Co. paper mill near Willamette Falls will make the city more attractive, according to Sonnenfeld.

“People are discovering Milwaukie, Oak Grove and Oregon City in a new way,” she said.

While a listing service called Zillow calls these areas “hot” markets, Happy Valley is a “cool” buyer’s market. Happy Valley’s real estate market is still affected by the 2008 recession.

In the early 2000s, the area experienced massive development. Buyers saw the beautiful views and built many high-end homes. But when the market crashed, Happy Valley had some of the most foreclosures because people could not afford big houses. In the past year and a half, Mathews says she has seen property values increase and developers return to the area.

Gladstone is a smaller community with less buildable land, but Mathews says there are some possibilities for development and the revitalization of older commercial spaces.

Regional Multiple Listing Service (RMLS) reported in May that in northeast Clackamas County, the amount of houses on the market and the average sales price have increased since last year, while the total time on the market has dropped. These statistics indicate buyers are still eager and waiting for new houses to be listed, even if they have to pay more.

Spring and summer sellers, like the Berglunds on River Forest Road, are entering the hottest real estate season of the year, according to the RMLS.

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