Strange Market Conditions, Middle and High End outpacing Entry Level

Our local market conditions over the last two years has clearly and concisely shown an increase in the median home price for Clark County. However the entry level market has slowed down substantially. A house that would easily sell for $500k two years ago now sits on the market for several months or the inpatient owner lowers the price. Meanwhile the middle and top of the price range remains hot largely due to a lack of inventory and increased demand from migrating Portlanders, and some Californians. 

I have beat this to death over the last couple years, but the reality is the middle and high end market loves the fact that they are sitting on a 3% mortgage and they just don't want to sell. People that have $700k or more to spend will outbid others to get the house in the upper end low inventory scenario we see now.

This is the weird state of affairs where the top half of the price range is in higher demand than the bottom. This is rare probably less than 10% of the time. I believe we are about to shift away from this trend as wages have crept up a bit and entry level buyers are returning to the market. For now, the top half rules the roost and it won't last long so those of you sitting on a house worth more than $600k, now could be the time to sell. There is a ceiling on how high end, super lux properties are still going to sit awhile since people with more than $2 million to spend remain few and far between.

Another anomaly in the local market is condominiums. The local condo market is getting negative pressure from across the river in Portland. This is particularly strong in the city center of Vancouver. Portland's South Waterfront and to a lesser degree the Pearl District is seeing a virtual glut of urban condos and prices have fallen sharply in the entry level Sub $400k range. This has made the now very popular Downtown Vancouver a more expensive alternative, whereas we used to be the value leader in city condos.

This soft entry level market will almost certainly, barring a major economic downturn, turnaround and return as the driving force of the housing market. Any first time homebuyers that qualify for $400-$500k should saddle up and go get a house before we return to a busy low end. It is already showing signs of recovering.

Strange market anomalies are often the best time to act, not always, but often, I believe for entry level buyers in the sub $500k range and upper end seller's between $700k-$1.5m, now is the time.