Experts are saying the prices for houses are close to the bottom—meaning price increases are just around the corner. And, houses are becoming increasingly affordable. Nationally, house prices are less than two-years’ salary. In Lane County, though they’re still higher than that.
However home ownership is part of the American Dream and the net worth of home owners is some 40-times greater than renters.
Is home ownership in your dreams?
Remodeling and renovating is another area of the market in Eugene and Springfield that fell on hard times during the Great Recession. We have bottomed-out though—and business is improving.
While home improvements don’t return dollar for dollar on resale, they still make sense if you plan to stay in the house for a period of time.
Rebuilding the housing market brick by brick.
New home construction fell to an all time low in February 2011, with an annualized national number of building permits at 517K. In Eugene Springfield new residential building is very slow right now. New building permits issued in January were reported to be 27, down 13% from January 2010. 466 building permits were issued in Eugene Springfield for all of last year.
Distressed properties are often cheaper than replacement cost, and there’s a lot of inventory of all types of houses to be sold; until both of those change, I don’t expect new house building to pick up much.
It’s still a great time to buy, though. Prices are down in Eugene Springfield and there are some great values.
There are fewer homes being built in Eugene Springfield in 2011
Many look at condos as an affordable option to home ownership. In Eugene and Springfield that’s true—you can find decent condos under 100K locally. The rub is financing. Condos can be difficult to borrow against.
Within the last year, over ½ of The Farm condos on Cal Young sold. Unfortunately, probably 90% of them will have to sell before they are easily financed. And they’re hard to sell without financing—lenders aren’t making this any easier.
A condominium project in Eugene.
Short sales in Eugene and Springfield are becoming increasingly commonplace. While difficult, both buyers and sellers put up with them. Why? For sellers, short sales damage their credit less than other options. For buyers, they represent great values.
Even expensive homes aren’t immune to short sales. Below is an example of a short sale I recently did. It sold for nearly ¾ of a million dollars. At 8 acres and 1/8 mile of McKenzie River frontage it was a great buy.
If short sales in Eugene or Springfield intrigue you, get a hold of me.
Sales of distressed property nationwide represent over 1/3 of recent sales. While the exact numbers for Eugene and Springfield aren’t available, the nationwide trend is representative of our local conditions. Many of these properties are being bought by investors—surprisingly for all cash. Tight credit is keeping a lot of buyers out of the market for these distressed properties.
Below is an example of a recent all-cash sale I made for a buyer in Springfield. It was a good bargain and will produce great cash flow. The house sold for $66,000. If you’re interested in rentals in Eugene and Springfield, get in touch with me.
We don’t often think about the Railroad in Eugene, unless there’s a problem–it’s just one of those things we take for granted. We are on the main-line between Seattle and Los Angeles, and local manufacturers still ship and receive product by rail car, a very efficient transportation method. (A train can move a ton of freight over 400 miles on 1 gallon of fuel, some three times more efficient than trucks). And, shooting up to Portland or Seattle via Amtrack is popular.
Gone, at least for now, are the major switching operations in the Eugene railyard. After Union Pacific bought Southern Pacific, many of the Eugene yard’s functions were consolidated to Roseville and elsewhere. When I was growing up here, S.P.’s yard was a significant employer. In the necessary drive towards efficiency, those jobs seem to be gone. Interestingly, rail shipping rates in the U.S. are the cheapest in the world.
On a brighter note, the elimination of the Eugene switching yard has made the adjoining neighborhoods in Santa Clara, River Road and Bethel more desirable. Train noise was a perceived problems when switching was occurring, but that’s been largely made a non-issue.
Eugene is connected to the U.S. by rail