Getting the money together for a down payment on a new home doesn’t have to be hard. If you plan, save, and make use of potential resources, you’ll be on your way to owning a home in 2021.
With many buyers looking to buy a home in the near future, we thought it might be helpful to publish an updated housing market report for Oregon home buyers. Here are five things you should know when buying a house in Oregon in 2021.
In This Article:
- Oregon home prices are rising
- Loan limits have increased
- Mortgage rates are also expected to rise
- A down payment of 20% is not always necessary
- Housing inventory is still tight in most cities
Are you looking to buy a home in Oregon in 2021? If so, you’ll want to get familiar with the market and buying a home in the state in order to make sure you make a sound purchasing decision. To help you do that, we’ve rounded up a few things that you should know before you purchase a home in Oregon over the next few months.
1. Oregon home prices are still rising.
Home price appreciation has been the big story in Oregon for the last few of years. Housing markets across the state have outpaced the national average, in terms of price appreciation. This is true for the broader Pacific Northwest as well.
In fact, Oregon posted some impressive gains over the past year, and they are expected to continue rising throughout 2021. According to Zillow, prices in Oregon have risen 10% over the past 12 months and are expected to continue rising over the year.
That’s the first thing you should know about buying a home in Oregon in 2021. If you postpone your purchase until later in the year, you could encounter higher housing costs.
2. Loan limits have increased.
As we’ve written in previous blog posts, the loan limits for Oregon have been increased for 2021. Federal housing officials increased the limits for conventional and FHA loans in response to rising home values.
Note: Home buyers with sufficient income can borrow more than these maximum amounts. When a home loan exceeds the limits for the county where the home is located, it is referred to as a jumbo mortgage loan.
Also, VA loan limits for Oregon in 2021 have been eliminated, That means qualified buyers are able to buy a home with no down payment regardless of the home price. That said, loan limits still apply to those who have more than one VA loan right now or who have defaulted on one in the past.
3. Mortgage rates are also expected to rise.
Rising home prices are something that certainly grabs the attention of Oregon home buyers, and rightfully so. But to help offset the costs of buying a home, economists are predicting mortgage rates to remain relatively stable throughout 2021. Freddie Mac expects mortgage interest rates to average 3.2% for 2021 for 30-year fixed-rate mortgages.
Related: Best loans for Oregon buyers
This is another important trend to watch, as it could affect anyone buying a home in Oregon in 2021.
4. A down payment of 20% is not always necessary.
Surveys conducted by real estate industry groups over the last year have shown that many home buyers think they have to put down at least 20% when buying a house. But that’s not true.
These days, some mortgage programs allow for a down payment as low as 3%. The FHA requires just 3.5% of the purchase price. The VA home loan program for military folks offers 100% financing.
Additionally, home buyers are often able to use down-payment funds from a third-party donor, in the form of a gift. This is something to be aware of when buying a house in Oregon in 2021.
5. Housing inventory is still tight in most cities.
The supply-and-demand situation in housing markets across Oregon has been lopsided in recent years. There has been plenty of demand from buyers, but not enough inventory to meet it. These supply shortages have boosted home prices while fueling fierce competition among buyers.
And while these trends will likely continue in 2021, to some degree, they should improve somewhat. New home construction has ramped up over the last year or so, but it’s still not enough to balance the real estate market.
For many years, many centers throughout Oregon have been experiencing a shortage of inventory. Many buyers have been in the market, but tight inventory to serve them.
Yet while the majority of these markets are still relatively low in inventory, historically speaking, the state has seen some growth in housing supply over the past couple of years. These days, buyers in certain parts may have more homes to choose from.
While the inventory crunch is most severe in Portland, similar conditions have been reported in other parts of the state. This too will affect those who are planning to buy a home in Oregon in 2021.
Need a Mortgage Loan?
Will you need mortgage financing to buy a home in Oregon? We can help. Sammamish Mortgage has been serving buyers across the Pacific Northwest since 1992. We serve all of Washington, Oregon, Idaho, and Colorado and offer many mortgage programs. Please contact us today with any financing-related questions you have.