Buying in Oregon: That House Will Probably Cost More in 2022

March 6, 2018
Last updated:
January 4, 2022
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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, later on in 2022?

Related: Oregon first-time buyer guide

There are some things we just can’t predict with certainty, and that includes future housing costs. Not long ago, experts forecasted that home prices in Oregon would increase over the next 12 months. But with some uncertainty over the recent health crisis and the economy, it’s difficult to make any such forecasts until the crisis has eased.

That said, the housing market across Oregon and the US continues to forge ahead despite the health crisis, though things may not be as strong as they likely would be in an ideal economic environment.

Houses in Oregon Are More Expensive This Year

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 later in 2022 could encounter higher housing costs.

As of January 2021, the average price for a home in Oregon is $482,347. That’s a 20.1% increase from the same month last year. While it might be difficult for experts to accurately forecast what home prices in Oregon will do in the coming months, it’s likely that prices could rise as the economy strengthens as the pandemic continues to ease.

Related5 mortgage tips for Oregon home buyers

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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. In fact, Oregon has some of the shortest inventory supplies in the entire country.

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 around a 1-month supply of homes for sale for the latter half of 2021.

Portland had around a 1.1-month supply. That means it would theoretically take just over 1 month to sell all homes currently listed for sale in Portland, 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 now, or is it better to wait until later in 2022?

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.

Mortgage Rates Extremely Low

According to a recent housing forecast from Freddie Mac, the average rate for a 30-year fixed mortgage loan is expected to reach the 4% mark by the end of 2022. With rates as low as they are today, this could offset any potential increases in home prices in Oregon. Even a 1% difference in interest rates can make a big difference in the overall cost of a mortgage to finance a home in Oregon.

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Need a Mortgage Loan in Oregon?

If you are looking to buy a home in Oregon in 2022 or beyond, you’ll want to work with a seasoned mortgage specialist to help. Sammamish Mortgage has been helping borrowers across the Pacific Northwest since 1992, including Washington, Oregon, Colorado, and Idaho. We offer competitive rates on a variety of mortgage programs. Please contact us if you have financing-related questions or would like to receive a rate quote.

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