Home buyers in Oregon tend to have a lot of questions about the local real estate market and how it relates to the purchase of a home. One of the most common questions is: Does it make sense to buy a house in Oregon now, in 2018? Or would it be better to wait until 2019?
Related: Oregon first-time buyer guide
There are some things we just can’t predict with certainty, and that includes future housing costs. But most economists and forecasters agree that home values in Oregon will likely continue to rise throughout 2018 and into 2019.
Houses in Oregon Are Getting More Expensive
It’s a supply and demand story, as always. There is a high level of demand for housing in cities across the state, but there’s not enough inventory to meet that demand. As a result, home buyers in Oregon who postpone their purchases until 2019 will likely encounter higher housing costs.
According to the real estate information company Zillow, the median home value for Oregon rose to around $320,000 as of February 2018. Looking forward, the company’s economists expect the median to rise by another 4.4% over the next 12 months. This particular forecast projects into the first quarter of 2019.
Other forecasters have echoed this sentiment. There appears to be broad consensus that home values across the state will likely continue to rise over the coming months.
In Depth: The Supply and Demand Situation
Let’s talk more about the supply and demand imbalance that is occurring across the state. This is one of the primary factors that is influencing home prices. So it’s support for home buyers to understand these market conditions.
Most real estate markets across the state of Oregon are experiencing a supply shortage. Inventory is falling short of demand, and that puts upward pressure on home values.
Let’s look at the inventory situation in Oregon’s three most populous cities. From a housing perspective, Portland, Salem and Eugene all have something in common. These real estate markets all had less than a 3-month supply of homes for sale in January 2018.
Portland had around a 2-month supply in January, and Eugene was the lowest of the three with a 1.3-month supply of homes for sale. (That means it would theoretically take 1.3 months to sell all homes currently listed for sale, if no new properties came onto the market in the interim.)
Economists and housing analysts say that a balanced real estate market has somewhere around 5 to 6 months worth of supply. So these markets are clearly “tighter” than normal, from an inventory standpoint. This is true for other parts of the state as well.
Getting back to the question at hand: Does it make sense to buy a home in Oregon in 2018, or is it better to wait until 2019?
Current trends suggest that home buyers who delay their purchases until later this year or next will probably encounter higher housing costs. All of these trends and forecasts make a good case for buying a home sooner rather than later.
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