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Are you thinking of investing in the real estate market in Oregon? If so, you’re making a great decision, as long as you pick the right area and property to buy.
Similar to any other business venture, doing some homework before you invest is of paramount importance. In terms of investing in Oregon rental properties, picking the right property to invest in is essential. Here are some factors to assess before you invest your hard-earned capital.
When looking at different neighborhoods to invest in, make sure to investigate whether or not there is any future development slated to take place in the near future. Not only could this affect your tenants, but it can also impact the value of your property and investment.
You should be able to get this information by calling or visiting your local building department to find out if there are any future developments in the works.
New construction can be a good sign of a healthy and growing neighborhood. But certain types of developments can have a negative impact on your investment. Plus, lots of new housing could also put you in a position to be competing with other properties.
Find out what the average number of listings should be in a particular area that you may be looking in. If an area has a lot more vacancies than what’s considered typical, that could be a bad sign that the neighborhood is in a downward cycle.
However, it could also be a seasonal cycle, but you won’t know that for sure until you do some homework.
If you get stuck dealing with a lot of vacancies all the time, that could eat into your profits and cause a lot of grief. What you want is to be able to fill your properties in Oregon with good tenants that are there for the long-haul rather than constantly have to spend time and money filling them.
Owning real estate comes with a number of expenses, and that includes property taxes. You want to find out what the property taxes are in the area you plan to buy in to make sure they fit in your budget.
Having said that, high property taxes could also be a positive sign that the neighborhood is desirable and in high demand, which can be a good thing for the value of your property. This means you may be able to attract tenants more easily and charge higher rents, while enjoying price appreciation.
Of course, you don’t want to have to pay more in property taxes than you have to, so try to find an area where property taxes are considered reasonable.
You make a profit when your rent is a lot higher than your expenses. Ideally, you’ll want to find a place that you can realistically charge a high rent amount. Find out what the going rent price is in the area before you buy, and compare that to the going prices for properties in the area.
For instance, $1,000 in rent might not sound like much if the place costs you $650,000, but it could be more than enough if the place costs you $250,000.
Make sure that the rent you can charge is more than enough to cover the cost of mortgage payments, utilities, maintenance, repairs, property taxes, homeowner’s insurance, HOA fees, and any other expenses related to owning your rental property.
So, where are the best places to invest in rental property in Oregon in 2024?
There are a number of great places in Oregon to invest in real estate. Here are a few examples of cities in OR that you may want to consider investing in this year:
Less than an hour’s drive to Portland is Salem, the capital city of the state of Oregon and a great place to look for investment opportunities. Salem itself has a strong labor force, but the option to commute to Portland provides even more employment opportunities for residents.
The median price for a home in Salem is well under the statewide average, making it an affordable place to invest in. And with an average rent of $1,450, that’s a pretty high price to charge in rent relative to what you’re paying for an average property in the city.
Plus, you can take advantage of a healthy increase in price over the next year, giving you a chance to build some equity in a relatively short period of time.
Eugene offers affordable home prices at just over $454,000. That’s just a bit under the statewide average of $479,906, so investors have the chance to tap into an affordable market that allows investors to collect a handsome rent of $1,550 a month.
Zillow predicts that prices in Eugene will increase at a healthy rate over the next year, especially after the incredible year we’ve just had, which means investors can also capitalize on some price appreciation over the next few months.
In fact, the real estate research firm characterizes Eugene’s real estate market as very hot right now, which means there’s plenty of demand, including from renters. That’s exactly what real estate investors should be looking for.
Another excellent choice for real estate investors looking to buy rental properties in Oregon is Medford. With an average home price of $386,698, the average rent price of $1,395 can go a long way at covering your carrying costs.
Medford is a desirable place to live, and renters know it, which is why the demand for housing in the city is relatively high right now. The current temperature of the market is very competitive, and things are expected to continue on this track over the next year. If you get into the market now, you could enjoy the upward trend of home prices before they continue increasing.
Albany’s real estate market is hot right now. Home prices have increased 1.8% over the past year and are expected to increase at a similar pace over the next 12 months. Getting into the market right now can afford you with an increase in home equity while avoiding higher prices that you would be subject to paying in the near future.
With home prices in the low-$400,000’s and high rent prices of just under $1,500 a month, you should have more than enough money in the pot to cover all your carrying costs, and then some.
Albany is a rather quiet city that’s characterized by plenty of stunning natural landscape, making it a great place to retreat while still being within a relatively decent distance from centers like Portland and Eugene. It’s a great spot for real estate investing, especially when considering the low housing prices and healthy rent price that landlords are currently fetching.
Sandy is a great place to buy investment property in Oregon in 2024 and beyond. Long-term rentals are in high demand among renters, especially because of the rapid growth in population that the city has recently seen. In fact the population of Sandy has spiked nearly 20% in the last decade alone.
Current average rental prices are just under the $2,000 mark, which is pretty decent relative to the affordable $496,733 price tag for the average home price in the city. The market is expecting home prices to rise at a healthy rate over the next year, so you could see a boost in home equity if you get into the Sandy real estate market sooner rather than later.
If you want to buy property in Oregon for investment purposes, a mortgage will likely be needed to help you finance this expensive purchase. If so, Sammamish Mortgage is here to help. We are a family-owned Mortgage Company that has been providing borrowers in Washington, Oregon, Idaho, and Colorado with many mortgage programs with flexible qualification criteria since 1992. Get in touch with Sammamish Mortgage today!
Whether you’re buying a home or ready to refinance, our professionals can help.
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No Obligation and transparency 24/7. Instantly compare live rates and costs from our network of lenders across the country. Real-time accurate rates and closing costs for a variety of loan programs custom to your specific situation.