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Old 08-02-2009, 02:20 PM
 
Location: Oregon
53 posts, read 252,119 times
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Save your pennies & rent....Housing prices are on a slow but steady decline...Check the Case-Shiller index; Eugene is one the the most overpriced markets in the US...The bubble popped later in the Pac NW then elsewhere.....
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Old 08-02-2009, 05:35 PM
 
Location: Eugene, OR
231 posts, read 733,385 times
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Quote:
Originally Posted by WorkinStiff View Post
Save your pennies & rent....Housing prices are on a slow but steady decline...Check the Case-Shiller index; Eugene is one the the most overpriced markets in the US...The bubble popped later in the Pac NW then elsewhere.....
I think Case-Shiller only covers wide areas, and not specific cities. Correct me if this info is not correct.

In terms of Eugene, I don't know how you can say it is "one of the most overpriced markets in the US." Based on what? Compared to what? I think you need to look at more than just a pure square foot price comparison. You need to consider the quality of living in various areas.

With the various data services out there, you also have to be careful when they quote market prices based on average house price sale. In most markets, those numbers can show significant swings simply based on the "mix" of high-end and low-end houses being sold in any particular period. In Eugene, the high-end houses have definitely sold MUCH slower this year than prior years. Under such circumstances, the "average selling price" will be lower, even if the medium range homes are selling for the same price as before.

Some other comments:

Eugene house prices are FAR cheaper than California, even after California prices have dropped 25% in some area. A $325K house in Eugene would still sell for $800K in any decent area in California. In the better areas of California (e.g. Monterey, Palos Verdes, etc.), the same house would be easily over $1.2 million.

Eugene houses are cheaper than Portland houses. (Some people like Portland's city feel, but I prefer Eugene's small town feel).

Eugene houses are much cheaper than Seattle houses.

Eugene houses are more expensive than houses in Texas (not all) and Arizona and places like Las Vegas. But that is really an apples/oranges comparison in my view (hot and dry versus green and wet).

Other places like Nebraska, Wisconson, Kentucky, etc: Well, I have to say that I just don't think I could ever live in any of those very conservative places. Many others like me, I think, would agree. So those price comparisons are not really valid in our cases.

Before I moved to Eugene, I could have chosen any place in the entire USA to live (my living location is not limited by work). I've been to Las Vegas and Texas and Arizona many times before, and they were all too hot and visually unappealing for me, so I did not consider those locations. I wanted to stay on the west coast for family reasons (as well as lifestyle/culture reasons). I drove up and down the coast a couple of times before finally settling on Eugene as the ideal location for me. Of course, the housing in Eugene is not the cheapest that we saw during our search, but the "value" is clearly here (i.e. considering lifestyle, culture, environment, weather, green forests, university proximity, hospital quality, etc.).

In terms of actual prices, at least for houses in the south side of Eugene, I have seen very little drop over the last 9 months. Houses in so so locations did drop about 5-7% over the last 1.5 years, but houses in strong locations barely budged.

On a more personal experience note, my particular neighborhood had about 8 (out of approx. 100) homes on the market in the last 6 months. In just the last 45 days, 6 of those homes have sold (or are pending sale). The speed that the "for sale" signs have disappeared in the last 45 days is really shocking. So the tide seems to be turning, at least in my area.

Of course, your point may be that the "bubble" has still not burst, but my gut tells me that Eugene housing is not in a bubble state and will remain stable and grow steadily in the coming years based on it's attractiveness as a living location (albeit, as I have said before in these forums, not an ideal place if you do not have a job).

Last edited by Mr Eugenified; 08-02-2009 at 05:50 PM..
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Old 08-03-2009, 11:26 AM
 
Location: Eugene, OR
231 posts, read 733,385 times
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Quote:
Originally Posted by WorkinStiff View Post
Save your pennies & rent....Housing prices are on a slow but steady decline...Check the Case-Shiller index; Eugene is one the the most overpriced markets in the US...The bubble popped later in the Pac NW then elsewhere.....
Another point to consider: If you are renting a house that is worth around $350K, the monthly rent will be $1650 per month, or $19,800 per year. That's money down the drain. So you would, in effect, be betting that a similar house would fall in price 5% per year over your period of rental. If you rented for two years, waiting for the prices to drop, the house price would need to drop by around 10% for you to BREAK EVEN. That does not sound like a good bet to me.

Plus, during that period, you could not really fix up your rental location, since you would not own it. Also, any furniture that you might buy for your rental location might not fit or match your eventual purchased home.
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Old 08-06-2009, 01:13 AM
 
6,061 posts, read 13,857,129 times
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OK Mr. E... So... what if you are renting for under $800 per month in Eugene? Are you still throwing money down the drain? We are so wishy-washy about buying. We rent a nice place for $800/mo, even though our income is over $100K per year and we know we could afford a nice house... but we're terrified of home ownership and are big dummies when it comes to all that home-buying stuff. (First-time home buyers syndrome...) We don't feel like we're throwing money away, because we're able to save so much by not buying. Just the mortgage itself would be an extra $400 or so each month. Plus currently we're saving because we have no PMI, no property taxes (which could easily add on another $200 or so each month if I'm not mistaken...), no landscaping, no maintenance and upkeep, no this and that and the other that all add up when you're a home owner... even our utilities are super cheap! We feel spoiled... but is it smart? Everytime we start to talk ourselves into buying, we think about all the money we're about to spend and we chicken out! We keep saying that the next time our lease is about to be up, we'll buy... but then when our lease is about to be up we say... "Oh, well maybe housing prices will fall even more! Maybe we should wait?" so we don't!
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Old 08-06-2009, 02:03 AM
 
Location: Eugene, OR
231 posts, read 733,385 times
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Re the $800 question: No, you are not throwing away as much cash as you would if you rented a 3 bedroom house (like the one you would buy, if you ever decide to buy). BUT the difference between the $800 and $1650 (rental amount amount for that same house) is the amount that you are sacrificing in quality of life by living in an apartment.

The difference between apartment living and owning a house is clear. Noise, too many people moving in and out, cramped space, parking issues, upstairs neighbors, downstairs neighbors, funky smells, shared garbage, shared laundry, etc, etc.

So really, the equation is theoretically still valid. You are spending $800 cash and $850 "sacrifice points" by renting an apartment now. That equals about $20K per year. Probably enough to pay a mortgage and the property tax on a suitable house. You would still need to pay extra for repairs and some other stuff, but of course, you would be living in a house that you OWN. Much different!

Short term risk is that the house goes down in value. Long term, it will go up for sure. Just be sure that your time horizon is 10 years. With young kids, you probably are easily looking at a 10-15 year horizons, but your work situation (or your husband's work) might change, and then there is a risk that you will need to sell the house before the prices move up. Even worse, you might need to sell it when the price drops a bit.

So, yes, there is still risk. You have to weigh it yourself based on your own conditions/plans.

Additionally: I think all the game rules have been interrupted (not broken) with this current financial situation. So, whereas normally I would say that you should buy soon because housing is always cyclical, and the prices have always risen in the long term. Now I would say that the cycle may take a lot longer this time. So waiting might be ok. On the other hand, who can predict when the economy will go back to the normal cycle? Maybe end of this year? Maybe next year? Who knows? My guess is that housing prices will "pop" by about $10-15K once everyone breathes a sigh of relief and feels that the economic corner has been turned. So by waiting, you will probably miss that chance (i.e. you will need to pay the extra $10-15K).

For me, renting an apartment was not an option I considered after looking around Eugene. Even renting a house was annoying for me, since I always felt very unstable in that situation. But that is just me. I moved for work reasons 14 times in the last 24 years, so I am sick of changing housing locations. :-D
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Old 08-06-2009, 02:06 AM
 
Location: Eugene, OR
231 posts, read 733,385 times
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I should also mention that I lost money on the first and second houses I owned because I had to move too quickly. So even though the prices went up a little bit from what I paid, after deducting real estate agent commission, I definitely lost.

On the other hand, I once moved to a new city and refused to buy a house for three years, paying rent all those years. During that time, housing in that city doubled in price. So I missed a huge chance to make big money by not buying earlier. I eventually did buy, and we still made nice profits when we sold, but not as much as I could have earlier.
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Old 08-06-2009, 12:01 PM
 
12 posts, read 28,976 times
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One new wrinkle in the home buying process that provides both security and problems, is the way homes are now appraised. Lenders, owners and buyers have less to say in who, or how, appraisals are made. They are made late in the buying process, and more independent than in earlier days when participants to the deal could influence the "value" decision to make a sale. The problem is that parties can enter good faith negotiations, only to find that the appraisal comes in considerably different, normally lower, than the negotiated amount, which negates the deal. On the other hand, security for the buyer and lender are enhanced by the independence of the appraisal. My point is, that appraisers are now forced to be more conservative than in the past. They pay a lot more attention to comparable values in the area than to esthetic value and individual house qualities, which are harder to value. If you are worried about house prices continuing to fall after you buy, the more sober appraisal system keeps you from potentially paying more than the house may be worth, now and the immediate future. Its a big issue in the market today, but gives buyers some protection against overpaying for a house. If fear of paying too much for a house keeps you in rental mode, I think those fears are less founded than ever, considering the lender lead pressure on the valuation process.
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Old 08-06-2009, 10:59 PM
 
6,061 posts, read 13,857,129 times
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Thanks for the reply Mr. E... I understand what you're saying. I've heard horror stories about renting, but luckily we are happy where we are. I guess we've been really lucky. We have a large garage with a personal space (we pay $65/mo for it, but it's included in our rent... without the garage we would pay closer to $730 for rent) and a personal covered carport (comes with the apartment) so parking is never an issue. Our neighbors now are all elderly ladies who are quiet and sweet and have lived here for years. Two moved here the year they were first built and have never left. Our apartment is actually a really nice size, for an apartment, anyway... (1060 sq ft for a 2 bedroom/2 bath) and we have our own laundry room with full-size W/D so there's no having to go to the landrymat or sharing or anything like that. I like our vaulted ceilings, and our sunny windows that keep things cheery-feeling. The kitchen is large and opens into the dining and living room area, and we have a sweet and sunny patio that we attempt to grow veggies on. Our two fat cats like to lazy about on the patio as well, watching the hummingbirds come and go. It's a happy, cozy place. We do have the strange smell sometimes from that paper pulp factory sometimes... in Halsey? But even if we had a house in this area we'd have to deal with that... that's an awful smell. Anyway... thanks for your input. And I apologize for going off-topic.
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Old 08-09-2009, 08:53 PM
 
4 posts, read 16,622 times
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I grew up in Wyoming and spent lots of time in Ft. Collins and Boulder while in college. Eugene is very much like Ft. Collins. I think you will really like it here. We moved here 20 years ago and have loved it! The Valley River Inn is a nice hotel (may be a bit pricey) that is centrally located and is right on the river/bike path. There are also some newer less expensive hotels on Franklin Blvd. near the U of O. Houses in the campus area are very expensive...but that would be a great place to live. Close to downtown, access to the bike path, near Hendrick's Park (beautiful!) and to sporting/other events at the U of O. Eugene is a very bike friendly town...there are bike paths on most of the major roads. South Eugene is beautiful but not at all convenient if you don't want to drive so I would not recommend that area. Also, stay away from the River Road/Santa Clara area of Eugene as the traffic is awful at commute times. We currently are renting an apt at Crescent Village...Eugene's newest "Urban Village" (Crescent Village) and love it. It's reasonably close to downtown and other areas...and also has it's own restaurants, wine bar and spa. Good luck. We hope you'll be as happy in Eugene as we have been!
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Old 08-12-2009, 09:50 PM
 
6,061 posts, read 13,857,129 times
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The Valley River Inn is a great place to stay - and they allow pets. Ask for room on the river side and you can watch people bop along the riverbike trail along the Willamette River. The restaurant there - Sweetwaters - is pretty good eatin', too. A little on the spendy side, but that's Eugene for you!
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