Difficult house hunt this past year and still nothing. Pay more or continue to rent?! (Portland: transplants, real estate market)

[MarsMom1967]

I'm a single mom (hubby passed away five years ago) of two kiddos and have rented in Portland for almost 20 years. Last year, I was finally in a position in to buy and was approved for an FHA loan with 15K cash. When I first started looking, the market was hot in the PDX area but not in the outlying areas as much (Oregon City and Milwaukie)..so I searched there. I was excited about what I was seeing and knew very soon I'd be putting in my first offer. But life caused a delay. Without going in to the entire story, my 2nd grader, who once had some pretty major anxiety issues, was having a horrible time in school and it caused me to realize I had to be careful where she ended up when I purchased a home. The houses I was finding fed into poorly rated schools. I considered a few small towns outside of the area with good school reviews..and so I was leaning in that direction and started visiting schools. These events unfolded over the course of months.

Finally, this past August, I found my dream school for her in Milwaukie (not sure how I missed it before!)...and she absolutely loves it and is thriving there now. Her issues vanished! So, clearly that was a good move on my part. BUT....by the time all this stuff panned out, the market in Milwaukie and Oregon City had changed considerably since I had first started looking. Suddenly, I'm seeing prices go up and bidding wars happening. I'm finally focused on exactly where I want to be but I feel like I'm too late. I was and am still finding homes in my price range but now instead of finding homes on quiet streets, as I had a year ago...I'm only finding homes on busy roads (double yellow lines) or, in one case, literally at the entrance to a high school parking lot. Ugh. Location is very important to me and I'm willing to sacrifice house size and other factors to get that..but still nothing. My realtor is telling me I'm only gonna get what I want by increasing my price point, of course.

My income has increased since last year and I can afford a higher payment but it makes me nervous to consider that because it's out of my comfort zone mentally. My rent went from 1300 to 1600 in two years but I don't pay water, which helps..but it took some time for me to accept this change. Based on what I know I can afford, my house payment would likely be between 1700 and 1800 to get into something decent that's not on a highway. We really need to get out of this rental because it's way too small for us and we just need a change. I sometimes look at rentals and frankly am finding that the rates are only slightly less if not the same as my house payment would be..although I know owning a home is more expensive but I cannot picture myself renting any longer.

But I feel so stuck. I cannot imagine pulling her out of this school and moving out of the area... but I also cannot imagine continuing to rent so she can remain there. I feel like I'm putting part of my life on hold. If we stay at this school, she'd be there till 8th grade..so we're not goin anywhere anytime soon. I realize I need to either bite the bullet and pay a higher house payment or just continue to pay slightly lower rent (although still expensive and not getting any cheaper).

Any suggestions, words of encouragement, similar experiences?? Thanks for listening to my woes...

[CAjerseychick]

so... you said your child was a 2nd grader- so thats 6 more years at this location, ideally?

Well in my experience, and from what I have seen in some very hot real estate markets (SF anyone?), people, over time get pushed out due to increasing rents and unaffordability of home prices.
House prices don't really tank in a tight real estate market.

You may find yourself getting pushed out of the area even if you choose to stay and rent- 6 years is a long time, and rents can
go up and by a lot.

Could you go creative and swing a higher house payment by having a roommate (thats what we did, and it ended up being a 20 year arrangement)...?

[oregonwoodsmoke]

Originally Posted by MarsMom1967

........ My rent went from 1300 to 1600 in two years but I don't pay water, which helps..but it took some time for me to accept this change. Based on what I know I can afford, my house payment would likely be between 1700 and 1800 to get into something decent .........

So, how high will the rent be in two more years? If you get a fixed rate mortgage right now at $1700, how high will your mortgage payment be in two years?

[notnamed]

Yeah Portland area rentals just keep climbing in price with no end in sight. Only way to get price stability is to buy. You need to compromise somewhere on the purchase or the rental market will make the decision for you and force you out of the entire Portland area in the not too distant future.

[Minervah]

Originally Posted by notnamed

Yeah Portland area rentals just keep climbing in price with no end in sight. Only way to get price stability is to buy. You need to compromise somewhere on the purchase or the rental market will make the decision for you and force you out of the entire Portland area in the not too distant future.

Unfortunately this is not an uncommon occurrence in Portland these days. Increasing COL especially in housing is causing people to be priced out of the area. Everyone wants to be near the best schools where their children are concerned. Unfortunately this causes the competition for available housing to be very strong.

OP, If you really wish to remain in Portland, you will have to find some sort of compromise like giving up the neighborhood you are hoping to buy into and choose one you can afford.

[ccjarider]

While perhaps not a response you like, does it makes sense to consider leaving PDX?
If your skills are transferable to another location, it might be a good change. $ goes farther in many areas and sometimes a life change is good for the soul.

I do realize from your opening post that you experienced a sad life change 5 years ago and that this suggestion may not be right for you at this time.

But it could be.
Good luck!

[Squidlo]

The Portland metro is pretty. The costs are high. As a previous poster stated have you considered another metro altogether? Apologies for asking.

I lived in Portland for years. I literally got priced out. More specifically priced into living in the same starter home forever (or leaving). My skill set transferred well and I ended up in Houston (north burbs). I lived in San Antonio for about 5 years and just couldn't put down roots. Houston has a better feel with the year round green and diverse culture. Home costs are at least 1/2 of Portland for comparison.

I am sure other people who have left the Portland metro over pricing can chime in.

I was in Portland in November scouting a possible move back. Nope, not gonna happen. I cannot reasonably justify the drop in quality of living to "come home".

[Minervah]

Originally Posted by Squidlo

The Portland metro is pretty. The costs are high. As a previous poster stated have you considered another metro altogether? Apologies for asking.

I lived in Portland for years. I literally got priced out. More specifically priced into living in the same starter home forever (or leaving). My skill set transferred well and I ended up in Houston (north burbs). I lived in San Antonio for about 5 years and just couldn't put down roots. Houston has a better feel with the year round green and diverse culture. Home costs are at least 1/2 of Portland for comparison.

I am sure other people who have left the Portland metro over pricing can chime in.

I was in Portland in November scouting a possible move back. Nope, not gonna happen. I cannot reasonably justify the drop in quality of living to "come home".

Yes, I am one of those people as well. Over the time period of nearly 40 years, I kept moving from one part of Portland to another trying to stay ahead of the ever increasing rents. My last neighborhood was considered to be "undesirable" when I moved there. But after nearly 30 something years living there I was priced out as it became gentrified and trendy.

That's just the way it happens sometimes. Many people want to live in the more popular, highly touted cities in the US but cannot afford to. In the time I lived in Portland, I have watched many new transplants and some long-timers make an exodus from Portland because they couldn't keep up with the rapidly increasing COL.

This is a big country, there are lots of other choices. I'm very happy where I am now. My quality of living is so much better where I am now because I don't have to be constantly worrying about being priced out. It's like a big load has been lifted.

I would encourage the OP to find a place where she feels financially comfortable. I would imagine there are many places that have good schools but don't cost a fortune to live there.

[notnamed]

40 years of renting? What drove you to rent that long rather than buy at some point and at least cash out on rise in house prices? That includes a few periods of time where anyone with a pulse could qualify for a mortgage.

[PDXNative2Houston]

Originally Posted by Squidlo

The Portland metro is pretty. The costs are high. As a previous poster stated have you considered another metro altogether? Apologies for asking.

I lived in Portland for years. I literally got priced out. More specifically priced into living in the same starter home forever (or leaving). My skill set transferred well and I ended up in Houston (north burbs). I lived in San Antonio for about 5 years and just couldn't put down roots. Houston has a better feel with the year round green and diverse culture. Home costs are at least 1/2 of Portland for comparison.

I am sure other people who have left the Portland metro over pricing can chime in.

I was in Portland in November scouting a possible move back. Nope, not gonna happen. I cannot reasonably justify the drop in quality of living to "come home".

Co-signed. Not only are other metros much less expensive, but higher paying jobs are much more plentiful... meaning you win from both sides of the equation.

You also have to ask what is most important to you. If the "hip" scene and scenic beauty of PDX are really important to you, more so than economic progress and security... fine, make it work but you'll sacrifice the latter for the former.