The housing market in Oregon is one of the most sought-after markets when it comes to making money in real estate. In this Oregon housing market forecast for 2022, we will take a look at the Oregon real estate market to see if it’s still one of the best in the 2022 US housing market.
In this article, we will take a look back at the Oregon real estate trends and prices, how the market was shaped in the past year and where it’s predicted to go in 2022 and beyond.
The first section of the article will go over the market performance and trends that affect the entire Oregon real estate market, while the latter section will focus on the real estate investment strategies available in the top cities while also including market data from Mashvisor regarding the projected return on investment in each market to help you build your real estate portfolio.
Without further ado, let’s jump into it!
Oregon Housing Market 2021 – A Look Back
To do a forecast of the Oregon housing market in 2022, we must first look back at the events that shaped up today’s market.
Over the past year, the Oregon housing market saw many changes and shifts that were somewhat different from the rest of the US housing market.
While the real estate market in Oregon saw a significant increase in housing prices, this increase was below the national average in the year 2021.
However, this increase in housing prices wasn’t as notable in previously hot markets such as Portland.
Instead, most of the growth happened in suburban and rural markets away from metropolitan areas.
This, of course, was a prominent trend across most of the US housing market in 2021 due to the increased demand for secondary residence in rural areas as a result of the COVID-19 quarantine period.
The disparity of this change between mature markets and newly popularized markets in Oregon shaped up in 2021 to result in two different market opportunities for investors.
Since the demand increase was focused on suburban and rural cities, the prices in these new housing markets are going to continue to increase, although at a slower pace.
On the other hand, hot markets might start seeing a decrease in demand compared to other markets as more buyers and investors are deciding to purchase properties in other smaller and emerging markets.
What to Look for in 2022
In this next section of our Oregon housing market 2022 forecast, we will answer the questions that are on every investor’s mind:
Prices to Rise?
When it comes to prices increasing, all indicators say that the prices will continue on an upward trajectory throughout 2022.
However, the increase in prices will be much slower, especially in metropolitan areas where growth is expected to slow down to pre-pandemic levels.
Suburban areas, on the other hand, are expected to continue seeing significant growth and being strong for the foreseeable future.
What About Foreclosures?
Surprisingly, while many real estate experts were expecting foreclosures to increase significantly due to the pandemic over the past two years, the drop in mortgage forbearance resulted in the opposite happening.
However, as things are moving slowly towards pre-pandemic normal, there is a chance that regulations might change and foreclosures might soar at some point.
If that happens, we might see housing prices being pushed down due to the effect of the foreclosure on the housing inventory, which would make it a great entry point for investors who are willing to take the risk and bet on it happening.
Mortgage Interest Rates to Increase?
Mortgage interest rates are something to keep an eye on in our Oregon housing market forecast 2022.
While the mortgage rates are still low, an increase in the interest rates in 2022 can have a noticeable impact on the housing market and in slowing down its growth.
Currently, the low interest rates are helping in increasing the demand. And while the rates are expected to increase in 2022, the rate at which they increase can be a determining factor and could deter some homebuyers from getting into the market.
According to the Mortgage Bankers Association (MBA), mortgage interest rates are predicted to average around 3.6% in 2022. This rate is quite low; however, it is still an increase of 1% over where the rates are at the start of 2022.
Where is Demand Increasing?
Larger cities like Portland, are still expected to see some growth according to our Oregon housing market forecast of 2022.
Its growth rate, however, will be a healthy and steady rate, unlike the significant increase that we’re seeing in smaller real estate markets across Oregon.
So, while major cities in Oregon are still stable markets full of opportunities, it’s the smaller cities that are hogging all of the attention going into 2022.
So, now that we’ve looked at some of the trends that we’re expecting to see in the 2022 Oregon real estate market, let’s take a deeper look at some of the markets in Oregon and how they’re performing at the start of 2022:
Top Markets in Oregon 2022
In this section of our Oregon housing market forecast 2022, we will take a look at some of the top markets in Oregon and how they’re performing.
There are three categories that we’re covering here:
- Fastest growing markets in Oregon
- Best markets to invest in vacation rentals
The data used in this section is from Mashvisor’s 2022 report on the Oregon housing market.
In case you don’t know, Mashvisor is a real estate analytics platform that gathers data from sources such as the MLS and Airbnb and uses algorithms to project the rate of return for each property listed for sale using metrics such as the cash-on-cash return or the capitalization rate.
The platform specializes in analyzing properties used for a real estate rental strategy, including both traditional (long-term) rentals as well as Airbnb and vacation rentals.
Top 4 Fastest-Growing Markets
Below are the cities that saw the fastest growth rate in the Oregon housing market.
This list includes cities that have become popular in the past and have maintained their popularity throughout the years, as well as cities that have recently gained a lot of popularity and growth due to recent market trends.
Bend
- Median Home Price: $979,753
- Property Size: 479.88 Sq. Ft.
- Occupancy Rate: 62.3%
- Traditional Rental Income: $1,848
- Traditional Cash on Cash Return: 0.65%
- Airbnb Rental Income: $4,454
- Airbnb Cash on Cash Return: 2.79%
- Walk Score: 28.64
Bend OR was possibly the second fastest-growing city in the country in 2020. And this popularity didn’t slow down.
Home values in Bend increased by 41% over the past year. And despite the supply shortage, home sales continued strong during the pandemic in Bend and in other thriving cities in Central Oregon.
Portland
- Median Home Price: $653,030
- Property Size: 442.03 Sq. Ft.
- Occupancy Rate: 73.63%
- Traditional Rental Income: $2,192
- Traditional Cash on Cash Return: 1.38%
- Airbnb Rental Income: $3,123
- Airbnb Cash on Cash Return: 1.78%
- Walk Score: 54.95
Portland OR has seen incredible growth in its real estate market since 2012, and became a popular investors market in 2019 when the market became less volatile.
Due to its solid economy, Portland wasn’t as affected by the slowed construction of new homes during the COVID-19 period, and despite lagging behind a little in terms of growth rate, the demand is still strong in the Portland real estate market.
If you’re interested in multifamily properties, in particular, Portland is a great market for that. Properties of these types have seen prices cooling down as more of them became available.
Happy Valley
- Median Home Price: $818,162
- Property Size: 323.96 Sq. Ft.
- Occupancy Rate: 64.1%
- Traditional Rental Income: $2,691
- Traditional Cash on Cash Return: 1.86%
- Airbnb Rental Income: $2,422
- Airbnb Cash on Cash Return: 0.95%
- Walk Score: 26
Happy Valley OR gained its popularity from its desirability.
Located just east of Portland and with access to the Clackamas River and Mt. Hood, this city is a haven for those seeking a calmer lifestyle surrounded by nature and recreational adventures.
The place is also a great location for families looking for a slower-paced life as well as to any travelers and adventurers looking for outdoor recreation opportunities.
This quality lifestyle is what contributes to Happy Valley’s strong and popular real estate market.
Salem
- Median Home Price: $464,414
- Property Size: 261.32 Sq. Ft.
- Occupancy Rate: 68.79%
- Traditional Rental Income: $1,524
- Traditional Cash on Cash Return: 1.93%
- Airbnb Rental Income: $3,738
- Airbnb Cash on Cash Return: 5.81%
- Walk Score: 45.06
This wouldn’t be an Oregon housing market forecast in 2022 if we did not mention Salem, the capital of Oregon.
Salem OR is considered an affordable city for the average family, and it is considerably more affordable than Portland.
Although it still has a supply shortage, single-family homes and rental properties provide smart investment opportunities in Salem, especially considering the stability and steady growth of the city and its economy.
Top 4 Vacation Rental Markets
Since Mashvisor specializes in both long-term and short-term rental properties, it’s only appropriate that we would create a list of the top markets to invest in when it comes to short-term vacation rentals.
There are many markets in Oregon that have thriving rental markets due to their popularity among tourists and travelers, making them excellent locations to own a vacation rental.
These cities are known for their relative affordability, numerous tourist attractions, annual events, and other attractions that make them hot markets for short-term renting.
So, here are the top markets to own a vacation rental in our Oregon housing market 2022 forecast:
Hood River
- Median Home Price: $725,167
- Property Size: 415.03 Sq. Ft.
- Occupancy Rate: 58.44%
- Airbnb Rental Income: $4,925
- Airbnb Cash on Cash Return: 4.34%
- Walk Score: 84
Hood River OR is a year-round destination for all kinds of travelers, which makes it a great place to own a short-term or Airbnb rental property.
While house prices might look intimidating in Hood River, they are projected to be quite profitable if you can afford them with a solid 4.34% cash on cash return.
Seaside
- Median Home Price: $569,980
- Property Size: 316.02 Sq. Ft.
- Occupancy Rate: 61.86%
- Airbnb Rental Income: $4,509
- Airbnb Cash on Cash Return: 5.33%
- Walk Score: 87
Seaside OR was considered one of the best places to own a vacation home in 2021 according to multiple real estate experts.
The city continues to perform well, and the return on investment that vacation rentals are generating in Seaside has been growing steadily over the years.
Redmond
- Median Home Price: $651,048
- Property Size: 333.28 Sq. Ft.
- Occupancy Rate: 55.21%
- Airbnb Rental Income: $3,346
- Airbnb Cash on Cash Return: 3.06%
- Walk Score: 77
The Redmond housing market has seen significant growth over the past ten years, and there are plenty of new construction developments to show it.
Redmond OR is both an attractive opportunity for traditional homebuyers as well as for investors.
McMinnville
- Median Home Price: $595,442
- Property Size: 301.18 Sq. Ft.
- Occupancy Rate: 65.98%
- Airbnb Rental Income: $4,808
- Airbnb Cash on Cash Return: 6.08%
- Walk Score: 91
McMinnville OR is a city that has it all, and it deserves to be included when it comes to this Oregon housing market 2022 forecast.
Not only does the city offer so much in terms of tourist attractions, amazing food, popular parks and museums, and the title of “foodiest town in the US” according to the Bon Appetit magazine, but McMinnville is also a city that has steady population growth, increasing home values, and plenty of rental properties being sold around.
Oregon Housing Market 2022 – Where to Start?
Now that you know what the Oregon housing market forecast for 2022 looks like, it’s time for you to make your decision to invest!
To help you make up your mind and find the perfect investment property to purchase, Mashvisor offers you a set of tools that are designed to help any real estate investor make better decisions based on actual data and market analysis.
Investment Property Finder
Using Mashvisor’s investment property finder can help you find properties for sale in your market of choice and based on your specific search criteria.
The tool consists of a map feature that showcases all markets and properties that are for sale, along with each property’s data such as its price, rental income, occupancy rate, and cap rate.
Using the many filters available, you can narrow down your search to only show properties that match your search criteria in terms of:
- Property price
- Traditional Cap Rate
- Airbnb Cap Rate
- Property type
- Age of the property
You can also use the heatmap feature which will give you color indicators to show how “hot” or “cold” each area is based on the metric that you have chosen, which includes traditional and Airbnb rental income, cap rates, occupancy rates, and more.
Bottom Line
When it comes to the Oregon housing market forecast 2022, the market isn’t expected to perform much differently from the rest of the US housing market.
However, Oregon’s real estate market has always been popular for a reason, and it is not any different now. It offers plenty of great urban and suburban options for investing.
If you’re looking to buy a house in Oregon, keep in mind that the prices are already high, and will continue to climb higher.
So, the sooner you buy the property, the less you will have to pay for it!
To help you make the entire process much easier and faster, subscribe to Mashvisor and let our tools do the hard work for you.