Author: Dianne Gregoire

As January comes to a close, I want to take advantage of the fact that January is Radon Awareness Month. This is important as you buy or sell a home, but it’s also important simply as a human who lives in a contained environment. Whether you are buying or sell or not, you should test your house for radon.

Radon is a naturally occurring gas that is given off by granite boulders. These boulders are buried deep in the ground. You can’t see them, so you don’t know if they are there or not. This is why everyone should be doing radon tests.

I first became concerned about radon when I read an article in a local newspaper about 20 years ago. A resident of my neighborhood, in the Lake Grove section of Lake Oswego, died of lung cancer. He had been a non-smoker. After his death, his wife checked their home for radon and discovered elevated levels. It was the likely cause of his death.

It’s estimated that 20,000 deaths in the US each year are caused by radon exposure. It is the second leading cause of lung cancer, after cigarette exposure.

While some parts of the metro area are known for elevated radon levels (the Alameda Ridge is Northeast Portland is often referred to as Radon Ridge), radon can be found in Lake Oswego. I sold a house in Village on the Lake a number of years ago and radon was found. It was a lake-front house.

In Oregon, radon is fairly common in the northern Willamette Valley. This is a result of the Great Missoula Flood that occurred thousands of years ago. A huge ice dam formed in the area of what is now Sandpoint, Idaho. It contained a lake that went deep into Montana. When the ice melted it released a huge flow of water and debris that came across Eastern Washington, dug out the Columbia River Gorge, and came to rest in the Willamette Valley. This flow contained granite boulders that, today, are the primary source of radon in homes in this area.

While there is no known safe level of radon, it can be measured. The test is simple. You can buy a test at most home improvement stores. You set two canisters in your house for several days, then mail them off to a lab, and you get emailed results within about 10 days. It’s been awhile since I’ve done it this way, but I believe it costs under $100. Or you can hire a professional. This costs about $150. They set a test box into your house for 2 days and you get same day results.

Correcting radon is usually under $2000. Not super expensive.

My point here is that it’s easy to do. Realtors in Oregon are trained to make radon testing a part of the home inspection process. But do the test for the benefit of yourself even if you aren’t selling.

I hope you find this information helpful. Here’s to going into February living in the safest and healthiest home possible.

Dianne

When I started in Real Estate 35 years ago, our sale agreement was one page, legal size, and there were few, if any, supplemental forms. If something additional needed to be added, like a home inspection, I took out a blank addendum and wrote it up myself. Over the years many, many forms have been added. The sale agreement is 11 pages long and there are about 100 supplemental forms.

Realtors are not attorneys, so it’s a good thing that we no longer write our own addendums for things like home inspections. However, we do have to know the forms inside and out. We use them and we need to be able to explain what they mean. This requires a lot of continuing education. Now, add to the mix that an entire new set of paperwork is being rolled out.

The forms that we have historically used were developed by Oregon Real Estate Forms, OREF. This entity primarily consisted of the two largest Realtor Associations in the state: Portland Metro and Eugene.

Now the Oregon Association of Realtors has developed a new set of forms. The old ones are not being retired, instead we will have 2 complete sets of forms to use and both are acceptable. This means that Realtors need to be training and learning about these new forms. There are pluses and minuses to both. I also think it’s likely that eventually one will dominate and my prediction is that it will be the new forms.

I am very proud to say that Linda and I have both been training for the past 2 months to become knowledgeable about the new forms. I think we are positioning ourselves to give the best service possible to our clients. I also want to give a shout out to Oregon First. Our company started this training, and went in depth with it, from the get go.

So, Linda and I are adapting and learning. It really is exciting and it feels good to know that we are positioning ourselves to give you the best experience possible when you buy or sell a house. We are here to be of help!

Dianne

I want to talk about the elephant in the room, rising interest rates. Just yesterday the Federal Reserve raised the Federal rate by .5% to between $4.25 and $4.5%.

The Federal Reserve Rate is the rate set by the Federal Reserve to dictate the cost of money when banks borrow from one another. If the banks are paying more for money, it just makes sense that the increase gets passed along to the consumer. That is how banks make money. It’s why they are in business.

I do think that the increased cost of mortgages is having a impact on the real estate market. Higher interest rates make homes less affordable. Is this going to cause a housing decline? In a word, no.

From what I have been hearing the current situation is likely short term

Several months ago I listened to a Bloomberg podcast that featured 3 economists. The consensus was that the inventory is so low, that the demand for housing will keep the real estate market strong.

At the beginning of the Great Recession, in about 2008, builders pretty much not only stopped building, but they also stopped laying the ground work for new neighborhoods. Coming out of the recession, in about 2014, the home building industry rebounded, but there were about 6 years of missing inventory and they just simply have not caught up, even to this day. To meet our population needs, Nationwide, we should be building 3,000,000 new housing units per year. These are houses, condos, and apartments. We have only been building 1,300,000 per year: not even half of the population need. It is going to take decades to catch up.

Economics is all about supply and demand. With the demand high and supply low, that supports housing values.

The other source of some interesting information was a Brian Buffini class that I took on Monday. It featured Lawrence Yun, the chief economist for the National Association of Realtors. Their discussion included several key points:

• Government regulations put into affect after the Great Recession tightened up the mortgage lending industry so that people actually had to qualify for their loans and prove credit worthiness and employment stability in order to get a mortgage. In other words, people can afford to make their payments.
• There is usually a 2% margin between the Federal rate and the mortgages rates. There is an anomaly happening where the spread is currently 3%. This means that the Federal rate can increase without there being an increase in the mortgage rates.
• Mr Yun predicts that 2023 will see interest rates come back down within the year to under 6%
• Mr Buffini predicts that 2023 will be flat with little or no home appreciation. However, he thinks that in 2024 the housing market will rebound with as much as 10% appreciation.

Here are my thoughts. It remains a great time to buy a house. With houses taking longer to sell, people who are selling are more negotiable. For a buyer, that means addressing repairs within the sale and negotiation on the price when you make an offer. For people wanting to sell, the inventory is still very, very low. Yes, it will take 30-60 days, but your house will sell and you likely continue to have a great deal of equity.

I have to say that no one knows for sure. These are simply thoughts shared by people with some knowledge and whose opinions I respect.

As always, thank you for reading the blotter.

Dianne