Are you ready to buy a house in Portland, Oregon? CCCU is here to guide first-time homebuyers through a few key considerations that make purchasing a home in Portland easier.
Most Portland residents and those considering relocating to the Rose City have probably spent a fair amount of time navigating the competitive housing market. If you’re considering buying a home in Portland but aren’t quite sure if it’s the right move, we’re here to help.
Buying your first home is a very big deal. It’s likely the largest purchase of your life and a decision that’s worth taking the time to mull over. However, there are a few things to know about buying a house in Portland, Oregon before you commit. Consider this the PDX guide for first-time homeownership!
According to Zillow, the median listing price for homes in Portland is currently $449,900, and the median sale price is $432,800, with an average of $289 per square foot. Home values went up 0.6% in 2019, and Zillow predicts they’ll spike another 2.3% in 2020.
In Portland, the median monthly mortgage payment is $1,853. Financial experts recommend allotting no more than 30% of your income to a housing payment, whether you rent or own a home. In order to afford the median mortgage payment in Portland, your annual household income should be at least $74,000.
On the other hand, rent prices in Portland are down. As of January 2020, the average rent price is $1,453, almost 12% lower than it was in 2019.
Reading these numbers might be overwhelming for prospective buyers. That being said, understanding the state of the local housing market will benefit you when you shop for houses in Portland.
Additionally, it’ll help you crunch the numbers when you’re deciding between renting or buying a home in Portland. And keep in mind that Inventory is low for both rentals and properties for sale. While renting an apartment might mean a lower monthly payment, it might not provide the stability of being an Oregon homeowner.
Homeownership comes with a long list of benefits, but it’s also an immense commitment. It’s crucial that first-time buyers in Portland and beyond have their finances in order and go in prepared for the responsibility of homeownership beforehand. So, are you ready to buy a house in Portland? The following key factors can help you determine if it’s the right choice for you.
Buying a house is expensive — there’s really no way to sugarcoat it. It’s necessary to have plenty of money saved up and have cash on hand for a down payment. It's also important to have a sufficient and reliable source of income to cover the monthly mortgage payments after you move in. Additionally, you’ll need to set money aside for a long list of closing costs and potential repairs, not to mention additional money for various expenses — there are always unexpected costs.
Can you afford the lump sum required to close the deal? How about at least a few hundred more dollars a month than your current housing payment, plus the cost of unforeseen repairs, if they happen? If you’ve got the funds, you might be in good shape to purchase a home. If you don’t, it’s totally fine to take your time and work towards your goal cautiously.
In addition to having substantial savings and a steady income, your credit score and credit history are a large part of the home buying equation. To get approved for a mortgage loan in Portland or elsewhere, you have to have an average (or above-better) credit score. Also, your credit report should show a history of on-time payments and relatively low credit utilization. In other words, you want to demonstrate responsible credit use and a clean bill of financial health.
Aside from your personal finances and credit health, the commitment and responsibility of owning a home shouldn’t be overlooked. Purchasing a property is a great investment opportunity — but it’s usually more ideal if you stay in the home for at least a few years.
On top of that, the responsibility of keeping up with a Portland home’s maintenance can be alarming for some first-time homeowners. You’ll of course have the freedom of being your own landlord, but all the upkeep will fall on your plate–along with the expenses–when you own a property.
Whether you’re ready to buy a house in Portland or want to wait until you have more money saved up, the Rose City is an incredible place to live. At Consolidated Community Credit Union, we’re dedicated to helping Portlanders reach their financial goals at any stage of the home buyer's journey. This could involve setting up a dedicated savings account for purchasing a property in the future or getting you the best rate on a mortgage.
Explore the home loans, mortgage tools, and first-time homebuyer savings accounts from our Portland credit union, or visit one of our three branch locations in PDX to chat with a lender in person. We look forward to meeting you!