Real Estate Blog

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Buying and Selling Real Estate in Lane County Oregon

Pastoral scene 3 miles from Eugene Oregon

Pastoral scene 3 miles from Eugene Oregon

Lane County continues to be a great place to live and to own real estate. Prices seem to have risen from their bottom at the great recession and are steadily climbing. Combine this with very low interest rates and many are buying and selling real estate in 2013.

I admit I’m biased, but I think Lane County is the best place to be in Oregon, and Oregon is considered a great place to live and to retire. Portland was recently ranked as number 2 in the nation for desirability for places to retire, and other Oregon cities often make the list.. Lane County is probably best known for its trees, water and Ducks. Natural beauty and recreation opportunities abound, and we’re a tourist hot spot. Eugene Springfield, Oregon’s second largest city, is known for both the University of Oregon and it’s relaxed eco-friendly lifestyle. Eugene is close to everything–both 5,000 ft. mountains and the awesome Pacific Ocean are only an hour’s drive away. And, our nice local airport makes everything in the world reachable within in a day or two.

Buyers and sellers of real estate in Lane County fall into a few broad categories:
• Retirees
• Vacation home owners
• Regular citizens living and working here
• Investors.

Lane County is a popular spot for retirement. Our cost of living is relatively low and our climate is mild. Taxes aren’t unduly high. We also enjoy low crime rates. Our health care system is good and we have the largest hospital between Portland and San Francisco. We’re also soon to get a very large V.A. hospital. On balance, Lane County stacks up well against other areas for retirement.

Vacation homes are also popular in Lane County. Some folks maintain a home in the city for doing urban activities or watching Ducks games. Florence and nearby areas have many coast cabin retreats. And, the McKenzie River is known for its beauty and fishing, so has quite a few vacation homes. Of course, Eugene, Florence and the McKenzie communities also have many year round regular residents.

Many find Lane County a great place to live and work. Our property values are relatively cheap compared to other cities on the West Coast, and jobs are available, although not always plentiful. Low crime, low commute times, and good schools make Lane County appealing.

Lane County has no shortage of real estate investors and investment property. Eugene Springfield are the main markets for commercial, industrial and housing real estate. Secondary markets are Junction City, Creswell, Cottage Grove and Florence. A subset of investment properties is student housing, which is found primarily in Eugene, the place with the most students, and to a lesser extent in Springfield, due to its proximity to Eugene. Occasionally, parents will buy their U of O students houses in which to reside while at school, although this isn’t overly common. Bell Real Estate is one of Lane Counties leading property management firms, and has been locally owned since 1964; we understand rentals, commercial and investment property.

Lane County has 350,000 residents, in round numbers. It’s at the southern end of the Willamette Valley, fairly close to the 45th Parallel, which is midway between the equator and north pole. It’s known for its temperate, if somewhat rainy climate. Geography ranges from flat coastal plains, to grass & pasture lands, to vineyards, to mountainous rugged wilderness areas. Over 1/2 of the population lives in Eugene Springfield, and the population density overall in Lane County is low. Over 1/2 the county is in forest, and about 1/2 of the land is owned by the government. Town size ranges from small and barely noticeable to the second largest city in the State, Eugene.

Notable towns in Lane County include:
• Eugene
• Springfield
• Florence
• Junction City
• Creswell
• Cottage Grove
• Oak Ridge.

When you are interested in real estate, whether buying or selling, a Realtor can be a great aid for you. Realtors know more about property, its values and idiosyncrasies than anyone else. If you are interested in real estate in Eugene Springfield, or anywhere in Lane County, Oregon, please contact me.  Or you can search listings here.

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Bell Real Estate

Buying and selling real estate in Eugene Springfield is never easy.  Houses are big ticket items and getting it right is important.  How do you get it right?  I think the best way is to find a good Realtor who’s honest and understands the market.  Bell Real Estate is 100% local and has been serving clients in Lane County for over 45 years.  How do you stay in business that long?  We think by doing it right.

Bell is a full service firm, probably best known for its property management, in which we’re a market leader.  We also have Realtors, of whom I’m one, doing a brisk business buying and selling property for clients.  If you have questions about buying or selling real estate in Lane County, I’d be glad to help.

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Bell Real Estate’s Main Office at 630 River Road

 

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2013 Eugene Springfield Real Estate Prices: Up

The new year makes a convenient time to look back and also pull out our crystal ball.  2012 may have marked the bottom of our real estate market in Eugene & Springfield.  Prices have trended up in the last few months.  Mostly, this is brought about by lack of supply, that is too few houses actively for sale.

In real estate’s boom years, before 2008, supplies of houses for sale dipped below two months, which was a strong seller’s market.  At the depths of the Great Recession, supplies greater than a year were seen around Eugene Springfield, indicating a strong buyer’s market.  Lately, we’ve been at 6 months or less, which is a mild sellers market.

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Eugene Springfield January 2013

Why the lack of supply of houses for sale?  One reason is Senate Bill 1552.  This good intentioned Bill had the effect of decreasing the rate of completed foreclosures, so fewer of them are on the market and more are still in the process of foreclosure.  The Oregon Supreme Court is scheduled to take a look at this in January 2013.  My guess is that they or the Legislature will change something.

Fundamentally, the prices of real estate are affected by things like inward migration and unemployment rate.  We’ve had fewer immigrants to Oregon in the last few years, and unemployment rates are stubbornly high, although decreasing.

My prediction for house prices in 2013 for Eugene Springfield is flat to mildly increasing.  I’ve been wrong before, though, and we’ll have to wait and see.

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Home Affordable Modification Program (HAMP)

According to a recent WSJ article, most mortgage modifications don’t work.  Less than 2% of the projected allotment of $75 billion for the HAMP program has actually been spent to help homeowners avoid foreclosure.

Nationwide, 6.7 million homes were lost to foreclosure or short sale in the decade ending in 2010.  Half again as many are projected to meet the same fate in the next 3 years.  If projections are accurate, that should keep it a buyer’s market through 2013.

The number of distressed properties in Eugene and Springfield isn’t exactly known—but they are common and I do a lot of them.  Rejection from the HAMP program was about 3 of every 4 participants in the western states, including Oregon.  If mortgage modification doesn’t work, a short sale may be a good option for you.

Most mortgage modificatins don't work.

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New Home Building Slows

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

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Eugene’s Railroad

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

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Renewable Energy

Eugene thinks of itself as a Green city, but it sounds like Reno may be beating us on this front.  They recently installed nine different wind turbines so that the City and the public could evaluate their performance.  Reno also has solar power helping to generate electricity.  One thing that’s cool about their system is that you can go on-line and look at its power generation real-time.  Looks like Eugene has some catching up to do.

Looking at real-time power generation in Reno

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Eugene: 2009 Summary, 2010 Forecast

Not much of a picture, but the best I could do under the circumstances (fog and on Christmas.) This is somewhat analogous to Eugene in 2009–not much of a year, but we did the best we could. We started the year with a terrible real estate market, with inventories close to 2 years. Fear and gloom were palpable with record unemployment and the greatest recession in many of our lifetimes.

While not spectacular, 2009 ended up better. Housing inventory shrank drastically, to around 6 months, and we even had a bit of a seller’s market in some areas. Distressed sales, namely foreclosures and short sales, were prevalent. Record low interest and the first time buyer’s tax credit helped pull us out of the slump.

My forecast for Eugene in 2010:
1) Housing prices will trend up slightly. Median price in Eugene will hover around 200K.
2) Interest will remain low for the first half of 2010, and be in the sixes by year’s end.
3) Unemployment will decrease to 8-9 %.
4) Distressed property sales will continue to play a major role in our housing market, with probably 1 in 10 sales in this category.

2009 Christmas was Foggy in Eugene Springfield.

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Tax Credit Extension

The WSJ recently ran an article that had more specifics about the home buyers tax credit, which can be used on homes up to $800,000 and has a maximum income limit of $245,000. The credit does have to be used for the purchase of your principal residence, but you no longer have to be a first time home buyer!

I recently sold this move-up house in South Eugene for 342K, on short-sale, down from the original listing price of 539K. There are plenty of good deals to use the tax credit on.

Short sales are some of the best bargains in Eugene.

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FHA reserves low

FHA capital reserves have fallen to ½ %, short of the 2 % minimum required by congress. In part this is due to FHA insured loans gaining in popularity, and in part it’s due to a higher default rate. FHA backed loans are one of the few ways of getting a home mortgage with less than 20% down payment.

So, what’ll happen? Most likely, at least in my opinion, will be an injection of capital from the Treasury. Alternatively, the minimum down payment may be raised from 3.5%, although this would chill the fragile housing recovery, and may be less politically tolerable.

I recently sold this house on short-sale, or pre-foreclosure, to buyers who used FHA for financing.

Down Payments as low as 3.5% are available through FHA.