Home values in Eugene, Oregon rose by around 10% during 2016, according to some sources. But a recent forecast suggests that Oregon home prices will rise more slowly in 2017, on par with historical averages.
Eugene Home Price Forecast for 2017
Like most cities in Oregon, Eugene experienced above-average home price appreciation in 2016. According to the real estate research team at Zillow, home values in the city rose by 10% during the 12-month period ending in December 2016. Such double-digit gains were common for Oregon housing markets in 2016.
But the company seems to anticipate a cooling trend in 2017, as far as house prices are concerned. Their 2017 home price forecast for Eugene, Oregon predicts a gain of about 3.5% during 2017.
Over the last few decades, house prices in the U.S. have risen by around 3% to 4% annually. The double-digit gains that occurred across Oregon during 2016 were abnormal by historical standards. So, in a sense, Eugene’s home-price forecast for 2017 suggests a return to normalcy.
This is good news from an economic and housing standpoint. When housing costs rise quickly in a short period of time, they tend to outpace income growth. Over time, this can lead to housing affordability issues. This is becoming an issue up the road in Portland, where the median home prices is now north of $400,000.
But house values in Eugene are lower, and they’re expected to rise at or near the historical average during 2017. So Eugene probably won’t experience the kinds of affordability problems seen in Portland, and that’s good news for home buyers who are entering the market this year.
Still a Sellers’ Market, Real Estate Professionals Say
Despite a possible slowdown in home prices this year, the Eugene real estate market still tends to favor sellers over buyers. That’s because the current supply of homes for sale is falling short of demand.
According to a report by local NPR station KLCC (which cited local real estate professionals), the Eugene housing market had about 1.9 months worth of supply as of December 2016. Five to six months of inventory is considered a balanced market. So Eugene is still very much a sellers’ market, as we move further into 2017.
The local supply-and-demand imbalance will continue to put upward pressure on home prices. It also means that buyers should be prepared for some stiff competition this year. There’s a lot of demand right now, especially for desirable properties in popular locations. As a result, homes tend to sell quickly with offers at or near the asking price.
Higher Loan Limits in 2017
Home prices in Eugene rose steadily, and significantly, over the last year or so. As a result, federal housing officials have announced that Lane County will have higher loan limits in 2017. This applies to both FHA, VA and conventional mortgages.
- FHA loan limits for the county rose to $275,665, for a single-family home.
- Conventional and VA limits went up to $424,100.
This is good news for home buyers, as it means they’ll have more properties to choose from in 2017 without venturing into “jumbo” mortgage territory.
Disclaimer: This article includes home-price forecasts and housing market predictions for Eugene, Oregon in 2017. These statements were provided by third parties not associated with our company. We have presented them here as an educational service to our readers.