Portland's excise tax on both commercial and residential projects worth more than $100,000 in value will assist in building housing for those city households making less than 80% of the national median income, but there is concern on the part of local real estate professionals about the long-range effect of the new law.
The limited availability of buildable land in Portland, Realtor Nick Krautter told Forbes, shouldn't affect the pace of building activity in the short-term, but if out-of-state buyer demand starts to drag, inventory significantly increases or interest rates go up, the new tax could result in a new-project slowdown. In addition, he said, the extra cost to builders and general contractors will result in higher prices for their customers.
Portland made the National Association of Realtors' Top 10 list of the best real estate markets for millennials last month because it, as with the other ranked metros, had a high percentage of millennials already living there, good job opportunities and, generally speaking, a lower income needed to qualify for a mortgage. However, even though the city might be millennial-friendly, it is still becoming one of the most expensive. According to March's 20-city S&P/Case-Shiller national Home Price Index, Portland home prices increased the most that month, at 12.3%.
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