Is Eugene the next Boulder?

[AJ Wong]

If I was a betting man my money would be on Eugene and the I-5 corridor of Oregon becoming the new hot spot for the Pacific Northwest. 

I have seen first hand the explosion of growth and missed a few opportunities in the Friendly Area of Eugene in the past 5 years. Notably that in that area particularly there are larger or quality homes often on very large lots (.25 acres of larger) within walking distance to coffee, markets and a community that is well...friendly. 

It reminds me most of visiting Boulder in 2015 and saying to myself, 'This place is going to blow up...' 

Fast forward nearly 10 years later and I get the same impression with areas of Eugene, Corvallis and Salem. 

The reality is that affordable homes in the Pacific Northwest are becoming increasingly unaffordable. Younger investors and generations are looking for an active lifestyle and few areas can compete with the outdoor amenities and facilities of Eugene and the Willamette Valley. It is very centrally located, incredibly accessible (Check out Avelo airlines) I recently took a flight from LA (Burbank) to Eugene direct, non-stop, $100 round trip. 

Average home prices have skyrocketed but in my humble opinion there is still considerable value. SFR in prime areas with potential for ADU's or other expansion can still be found in the $350k-400k range. Multi unit properties can still be acquired in the $150-200k/door range and rents are rising.

The University of Oregon has committed hundreds of millions to the future and the 'downtown' has seen recently improvements and investment by national hotels and a new Nike store. 

A quick drive around will show you things are happening and the official statistics show tremendous growth with very little developable land to accommodate the population influx. So much so that the State of Oregon has essentially rubber stamped ADU's in cities of sizable populations and the city of Eugene even offers 'pre approved' ADU designs for permitting and construction.

I'm not saying that Eugene offers the same Boulder or Seattle suburb, but the properties are eerily similar for a fraction of the current price points. My sister lives in Bothell and purchased a home 5-6 years ago for roughly $500k, a client made an offer on a beautiful Eugene property last week in the same price range that was superior in every conceivable metric. Her home is likely worth $750-850k present day, I could easily envision this Eugene property being equivalent in value one day. 

I am currently working with no less than five buyers from out of state seeking to relocate or invest in Eugene or just beyond. 

Affordable homes are seeing multiple offers within days and in comparison to the areas buyers are migrating from (Los Angeles, San Francisco and Seattle) there is a lot of growth potential and value. 

I was surprised to learn that the average home price in Boulder is now nearly $1M!? (Boy did I miss that boat..lol) 

The average sales price in Eugene is roughly $485k.. 

[Lawrence Potts]

Quote from @AJ Wong:

If I was a betting man my money would be on Eugene and the I-5 corridor of Oregon becoming the new hot spot for the Pacific Northwest. 

I have seen first hand the explosion of growth and missed a few opportunities in the Friendly Area of Eugene in the past 5 years. Notably that in that area particularly there are larger or quality homes often on very large lots (.25 acres of larger) within walking distance to coffee, markets and a community that is well...friendly. 

It reminds me most of visiting Boulder in 2015 and saying to myself, 'This place is going to blow up...' 

Fast forward nearly 10 years later and I get the same impression with areas of Eugene, Corvallis and Salem. 

The reality is that affordable homes in the Pacific Northwest are becoming increasingly unaffordable. Younger investors and generations are looking for an active lifestyle and few areas can compete with the outdoor amenities and facilities of Eugene and the Willamette Valley. It is very centrally located, incredibly accessible (Check out Avelo airlines) I recently took a flight from LA (Burbank) to Eugene direct, non-stop, $100 round trip. 

Average home prices have skyrocketed but in my humble opinion there is still considerable value. SFR in prime areas with potential for ADU's or other expansion can still be found in the $350k-400k range. Multi unit properties can still be acquired in the $150-200k/door range and rents are rising.

The University of Oregon has committed hundreds of millions to the future and the 'downtown' has seen recently improvements and investment by national hotels and a new Nike store. 

A quick drive around will show you things are happening and the official statistics show tremendous growth with very little developable land to accommodate the population influx. So much so that the State of Oregon has essentially rubber stamped ADU's in cities of sizable populations and the city of Eugene even offers 'pre approved' ADU designs for permitting and construction.

I'm not saying that Eugene offers the same Boulder or Seattle suburb, but the properties are eerily similar for a fraction of the current price points. My sister lives in Bothell and purchased a home 5-6 years ago for roughly $500k, a client made an offer on a beautiful Eugene property last week in the same price range that was superior in every conceivable metric. Her home is likely worth $750-850k present day, I could easily envision this Eugene property being equivalent in value one day. 

I am currently working with no less than five buyers from out of state seeking to relocate or invest in Eugene or just beyond. 

Affordable homes are seeing multiple offers within days and in comparison to the areas buyers are migrating from (Los Angeles, San Francisco and Seattle) there is a lot of growth potential and value. 

I was surprised to learn that the average home price in Boulder is now nearly $1M!? (Boy did I miss that boat..lol) 

The average sales price in Eugene is roughly $485k.. 

Very insightful! Thank you for sharing this.

Most counties in the area are struggling to supply the high housing demands for renters and buyers. We cannot build fast enough. Even in our hyper localized markets, we are seeing prices forcing marginal buyers into the outskirts of main cities. Stayton has grown significantly in the last 5 years. Lebanon has nearly doubled in the last few years. I have buyers that work in Wilsonville that are wanting to buy in Salem and are willing to commute an hour each way for work because housing prices are half that from Wilsonville to Salem.

We've seen all local counties adopt new zoning restructuring to allow SFR's to permit ADU's. Think about it....the city and county decided that anyone can build an ADU in their backyard and become a landlord. That's how short of supply we are. Anything below $400k in Corvallis is seeing MULTIPLE offers within the first week of listing. We are down 40% in inventory than we were last year at this time.

I'm thinking that communal living will become more common: people renting out bedrooms to strangers, ADU's will start becoming a norm, and any form of house hacking is going to be necessary to experience homeownership. As long as we continue to see downward inventory, we will be seeing housing prices move higher and higher. I also believe that renting will be the new normal standard of life as well: forever renters will be the new exception to the American Dream. We may see more government funded housing as well if wages cannot exponentially grow with rent increases and housing prices. In any case, I still believe that buying now is the best financial choice, even with rates sitting where they are.

Thank you again for sharing!