In the span of six months, Malori Musselman submitted more than a dozen bids for homes in the Eugene-Springfield area, only to be outbid each time by another buyer.
“If the home ad doesn’t say they’re looking specifically for first-time buyers or for those who are looking for their home forever,” says Musselman, “I’m going to assume I’m going to be outbid between $ 25,000 and $ 75,000. .
Musselman, who is not binary and uses them / them pronouns, is one of many potential first-time buyers competing in today’s hot housing market. With the exception of a small setback at the start of the COVID-19 pandemic, real estate in Eugene and Springfield has been a sellers’ market.
The Eugene-Springfield real estate market is changing rapidly due to low interest rates, low housing stock, a global pandemic and the geographic advantages of the Pacific Northwest, says Ben Fogelson, senior broker at InEugene Real Estate.
Since the Eugene-Springfield area is located in an area with abundant water and relatively low number of natural disasters, it is attractive for transplants from California and Colorado, Fogelson explains. And then there are people moving out of the big neighboring cities – Seattle and Portland – who no longer want to live in a high traffic area, he adds.
“There are a lot more buyers in the market,” he says. “Some of the higher markets with a ton of money and compete against each other and the locals. It is therefore very difficult as a buyer to enter into a contract with a property.
He adds that for salespeople, “You are well seated, you have the merchandise and you can decide. “
Due to equal housing laws, the housing market is bound by the free market – a system that favors the buyer with the most money. He recommends that buyers consider using programs aimed at first-time buyers to increase their mortgage limits, although the person with the money is likely to earn someone who needs a loan.
“Cash is usually going to grab a seller’s attention more than a funded offer, because right off the bat you’re eliminating part of the deal,” says Fogelson. “If I’m trying to buy a house with a lender, there are three parties that can ruin the deal.
Without the presence of the lender, he adds, the process doesn’t require an appraisal, so the transaction goes faster.
Musselman is one of many bidders on houses with a conventional mortgage (one without government assistance). Their highest mortgage amount is $ 375,000, which they say would have been a difficult monthly payment. “Lots of homes in the prime affordability zone below $ 350,000, there are so many deals on them,” Musselman says. “Our real estate agent would let us know that the house had 20 or more offers on some of them.”
But $ 375,000 is lower than the median selling price of a home in Eugene, according to Redfin, a real estate data aggregator. In June 2021, the median price for a home was $ 425,000, up 26% from 2020. Before the pandemic, one in four buyers paid more than the asking price for a home, and in June 2021, two out of three buyers paid more than the price. ask for a price. Lane County homes often only stay on the market for six days.
The median household income in Lane County is $ 57,325, according to 2019 data from the U.S. Community Survey.
Rising property market prices do not translate into higher property tax revenues, says Lane County Assessor Mike Cowles. Measure 50 limits the maximum growth in assessed value to 3%, he adds, and most real estate transactions meet that cap.
Hoping to stay within the $ 300,000, Musselman says there were homes they and their partner were considering even if they fell short of expectations. They sent offers for houses that were too small and some that did not have enough space for their dog to exercise.
Fogelsen says he often tells his clients to be willing to concede certain desires they have for their dream home. “At the start, they give me a list of whatever they want,” he says. “I warned them once, almost everyone who buys in the market today has to compromise.”
He adds that by knowing what you’re willing to compromise on, like fenced backyards, neighborhood appeal, and other amenities, customers are less likely to have buyer’s remorse.
A few weeks after speaking with GE, Musselman ultimately closed on a house. The housing market is a community and social issue, and sellers should be made aware of what their choices are doing to the community, says Musselman.
“It’s worth putting properties up for sale to people who need them. It’s a choice each of these sellers makes to accept large cash offers from investment firms, ”Musselman said. “It’s not something we’re talking about or what it does to a community or why making that decision isn’t as individualistic as it sounds. It can ultimately ruin a community; it can gentrify an area too much or kick people out altogether, leaving empty houses out. ”