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Eugene Real EstateMarket Update | October 2022

Eugene Real Estate Market Update | October 2022

Eugene, Oregon Market Update | October 2022

Everyone locally is talking about what is happening in Eugene, Oregon, real estate market. Should I buy a home, or should I wait?

First off, let’s talk about the rental market. Maybe you heard this or didn’t, but Starting Jan. 1, 2023, landlords in Oregon may legally increase rents by up to 14.6%. This year, the cap is 9.9% – marking a 4.7 percentage point jump from one year to the next. Unfortunately, many renters were uneducated on SB 608.

 SB 608 allows landlords to raise the rent to a certain amount every year (seven percent plus inflation), not above, which we see as the highest inflation in 40 years. As a result, many tenants will likely be in a pickle and have to go with whatever the landlords ask with little vacant rental housing. Others may end up sharing space with family or friends.

Let’s take a look at new construction quickly because this plays a large role. The pandemic set the stage for higher prices and shortages of construction products. Lumber futures jumped to an all-time high $1,670 per thousand board feet in May. They’ve since dropped to $634, about 10% higher than a year ago. Still, wholesale prices for a category of homebuilding components that includes windows, roofing tiles, doors, and steel increased 22% over the last 12 months, according to an analysis of Labor Department data conducted by the National Association of Home Builders. Before 2020, it was typical for prices to rise a little over 1% annually. Not only are Higher building materials prices are not the only factor driving up builders’ costs. A chronic shortage of skilled construction workers has worsened during the pandemic, forcing builders to factor in higher labor costs.

And the lack of financing, particularly for land acquisition, development, and construction loans, contributes to the low supply of available land and buildable lots. Layered on top are local land use, zoning, parking requirements, permitting processes, and design reviews, reducing the timeliness and number of units being built.

Okay, what have you been waiting for. What does our real estate market in Eugene, Oregon, look like? This is as of today Oct. 10, 2022. This is an overall market update on Eugene as a whole. 

The median home price of new listings in Eugene, Oregon, is $490,000, with the price per square foot at $299. The average days on the market is 49 days. 

Rising interest rates have begun to slow the overheated housing market here in Eugene, as monthly mortgage payments have risen dramatically since the beginning of the year. Leaving some people who want to purchase a home priced out of the market and others wondering if now is the time to buy one. But this rise in borrowing cost shows no signs of letting up soon. 

Realtor.com says 

“While even two months ago rates above 7% may have seemed unthinkable, at the current pace, we can expect rates to surpass that level in the next three months.”

If you are thinking about purchasing a home, talk with a lender sooner then later, as most lenders will be able to lock your rate for 90 days. 

This has been a very volatile time in the real estate market. I am getting a lot of questions about where we can see our market in Eugene, Oregon in the next few months, as Eugene did not get hit as hard as other cities in the recession in 2008. However, I feel we have people still moving to our area and that homes are still moving, especially in the lower price ranges. 

This is what experts are saying:

If you look at what experts are projecting for home prices in 2023, they’re forecasting home price appreciation around 2%. While it’s true some are calling for depreciation, most are calling for appreciation in home values over the next year.

The second spot to turn to for information is the Home Price Expectation Survey from Pulsenomics – a survey of a national panel of over one hundred economists, real estate experts, and investment and market strategists. According to the latest release, the experts surveyed are also calling for home price appreciation for the next several years.

I hope this helps you understand what we see in our market locally and nationally to help you make an informed decision when purchasing a home in Eugene, Oregon. If you have further questions, leave a comment down below. Have a great day!

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