Portland's housing market is showing signs of relief for would-be buyers.

The inventory of homes on the market climbed in May. Fewer bidding wars broke out, and price growth has slowed.

But it's a tale of two markets, brokers say. While the top of the market is cooling off, there's still stiff competition over homes that are affordable to first-time buyers.

New numbers from the Regional Multiple Listing Service show there were 5,380 homes on the market at the end the month, the most of any May since 2014.

The median home price rose to $409,000, an increase of 5.4 percent from a year earlier. Prices are climbing half as fast as at this time in 2017.

Sales, however, are falling. The listing service said some 2,800 homes sold in May, a decline of 3.2 percent compared to a year ago.

Other indicators suggest that might be related to the slim supply of homes on the market.

It would take less than two months to sell every home on the market if sales continued apace. Less than six months of supply typically indicates a seller's market.

And homes that sold in May were on the market an average of just 37 days from listing to close, two days shorter than last year.

"Where we used to see 10 to 15 competing offers, we're now seeing three to five," said Matthew Novak, a broker with the real estate firm Redfin in Portland. "Of course, there is going to be more competition in certain neighborhoods that are a little hotter."

That includes anywhere a home can be had for less than $400,000, Novak said. For first-time buyers, who are also feeling the pressure of rising mortgage rates, little has changed.

"The heat is still there," he said. "The competitiveness is still there."

Homeowners looking to sell, having watched the red-hot run of recent years, are still adjusting to the slower gains.

Some are overly aggressive in pricing their homes, which can backfire if you have to drop your price, said Dustin Miller, a broker with Windermere Realty Trust in Lake Oswego.

"If the buyers see you do a price drop, now they think your price is flexible, especially if you've been on the market for a long time," Miller said.

Some buyers, particularly those looking to move up to a more expensive home, are also getting overconfident. Novak said contingency offers -- which depend on a condition such as the buyer selling their current home -- are growing more common.

"They just really aren't considered," he said. "You can have superior numbers superior terms, but you put that contingency in there and you're shuffled to the end of the pile."

Buying, selling or renting a homes? Email the reporter to share your experience and inform future reporting.

-- Elliot Njus

enjus@oregonian.com

503-294-5034

@enjus