8 Steps to Buying a House in Oregon

Jamie Ayers

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Jamie Ayers

September 16th, 2022
Updated September 16th, 2022

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8 Steps to Buying a House in Oregon

Save for down payment | Find a real estate agent | Get preapproved for a mortgage | Choose your neighborhood | Go house hunting | Make an offer | Inspections and appraisal | Final walkthrough and closing

Buying a house in Oregon is an exciting milestone, but the process can take some time. Several factors, like your financial situation, market conditions, and the local economy can affect both how long it takes you to find a home and how much it costs you.

For example, homes in Albany are hitting the market at $445,000 and selling within 33 days — 21 days faster than the state average! — so you'll need to move quickly if you want to beat out the competition.

The more you know about the home buying process and Oregon's current real estate trends, the more prepared you'll be to navigate this complicated process as quickly and smoothly as possible.

No matter where you are in your home buying journey, Clever can connect you with local real estate pros who will help you purchase your Oregon dream home!

The best part? Clever's service is 100% free! You can meet local lenders and real estate agents with no obligation. If you don't find the perfect match, you can walk away at any time.

» START: Find top local agents today!

Step 1: Save for a down payment

🔑 Key takeaway:

Your down payment can be less than 20% of the purchase price — $103,675 for the typical home in Oregon — but you'll have to purchase mortgage insurance and pay more interest over the life of your loan.

Your down payment is the first part of your home's purchase price that you pay at closing. Your mortgage lender will pay the remaining balance.

Typically, mortgage lenders in Oregon want you to contribute 20% of the purchase price as a down payment. That would be $103,675 for a $518,377 home — the typical home value in Oregon.

However, you have options to lower your down payment amount.

Government backed loans, like VA and FHA loans, allow you to contribute 0% and 3.5% of your home's purchase price respectively. Even conventional loans allow for down payments as low as 3-5% (though the minimum varies by lender).

Mortgage type
Minimum down payment (%)
Down payment ($)
VA Loan
0%
$0
FHA Loan
3.5%
$18,143
Conventional
3%
$15,551
Based on typical home values from Zillow (August 2022)

But making a down payment of less than 20% comes with some risks.

First, because you're borrowing more money, you'll have a higher monthly payment and pay more in interest over the life of your loan.

Down payment
Monthly payment
Total interest
Total Cost
5%
$2,808
$518,600
$1,036,977
20%
$2,365
$436,716
$955,093
Based on home values from Zillow (August 2022) and a 5.54% interest rate for a 30-year loan.

Second, you may have to purchase mortgage insurance.

Conventional loans require private mortgage insurance (PMI) until your loan balance reaches 80% of the purchase price. FHA loans, on the other hand, require a mortgage insurance premium (MIP) for the life of your loans.

Mortgage insurance costs around 1% of your mortgage balance annually. However, rates vary based on your down payment and credit score. Typically, your mortgage insurance payment is added to your mortgage payment each month.

VA loans don't charge mortgage insurance. Instead, you'll pay a VA loan funding fee at closing, which can range from 1.4% to 3.6% of the purchase price.

» READ MORE: Everything you need to know about low-income home loans

Oregon down payment assistance programs

The state offers numerous down payment assistance (DPA) programs to help low-income and first-time buyers afford a home. If you're eligible, you could receive a grant or second mortgage to cover closing costs or a down payment.

Here are a couple DPA programs available to Oregon residents:

Portland Housing Bureau DPAL Program

The Portland Housing Bureau can offer DPAL Program participants a 30-year loan for up to $100,000. The loan accrues no interest, has a low APR of just 0.012%, and can be forgivable after 30 years. Depending on the buyer's needs, a minimum of 10% of the loan might be set aside as a grant.

This program is available to first-time homebuyers with a first mortgage from one of the Portland Housing Bureau's approved partners. Annual household income must be at or below 100% of Portland’s area median income, and the property must be within the Portland city limits. Additional fees may apply.

Oregon Housing and Community Services

Through the Oregon Housing and Community Services, first-time homebuyers may be eligible to receive up to $15,000 in financial assistance. This organization works with several agencies and partners, so you can search for programs in your county and check eligibility requirements here.

U.S. Department of Housing and Urban Development

You can find additional DPA resources from HUD here.

Step 2: Find a great real estate agent in Oregon

🔑 Key takeaway:

Interview multiple agents to find one who knows your target neighborhoods, has experience in your price range, and communicates well.

Your real estate agent will be your main ally during the home buying process. Besides finding and showing you properties, your agent will help you make offers, negotiate contracts, and navigate the closing process. Plus, they can recommend other service providers like title companies and inspectors to help you buy your home in Oregon.

Don't rush into choosing an agent. Instead, take the time to research and interview multiple real estate agents who have experience in the neighborhoods you're interested in. You should pay attention to a realtor's:

  • Years of experience
  • Number of transactions in the last year (the more the better!)
  • Experience in your price range
  • Overall review score
  • Individual reviews and complaints

Top Local Agents Hand-Picked for You!

Clever matches you with multiple agents in your area so you can interview, compare, and choose the best one to help you buy your next home.

Step 3: Get preapproved for a mortgage

🔑 Key takeaway:

Once you're preapproved for a mortgage, it's imperative that your financial situation doesn't change. If your credit drops, it can derail the process and keep you from closing on your house.

Here are some easy ways to ensure your credit doesn't change after you receive your preapproval letter:

  • Avoid opening new credit accounts
  • Don't close any accounts that have been open for a long time
  • Make all of your credit card payments on time

» LEARN MORE: What factors do mortgage lenders consider?

A mortgage preapproval letter is an offer to lend you up to a certain amount of money to purchase a home. It shows sellers that you are a serious buyer who is financially qualified to make an offer on a home.

Most sellers in Oregon will require preapproval before showing you their home.

You don't have to decide on one lender right now. In fact, you should compare interest rates and preapproval amounts from several lenders to make sure you're getting the absolute best terms when you buy your Oregon home.

Get Pre-approved Today!

Get matched with a lender who can tell you how much house you can afford. To get started, where do you plan on buying?

Step 4: Choose the right location

🔑 Key takeaway:

Search for neighborhoods where:

  • Home prices are within your price range
  • Home values are on the rise
  • The local amenities support your lifestyle

Currently, the typical home value in Oregon is $518,377, but don't worry if that doesn't perfectly match your budget. Home prices vary dramatically from city to city and even from neighborhood to neighborhood!

Also, look at past home value trends. This will give you an idea of how much your home's value could go up over the next few years.

To give you an idea of how appreciation could impact what your house is worth in the future, consider these examples from three neighborhoods in Portland:

Home value appreciation in Portland

Neighborhood
2015
Current
Appreciation
Powellhurst Gilbert
$205,277
$418,796
51.0%
Hazelwood
$224,879
$446,425
49.6%
Centennial
$204,561
$421,100
51.4%

Step 5: Start house hunting in Oregon

🔑 Key takeaway:

There has been a surge of inventory in Oregon, and while prices have increased slightly, there will still be a lot of options in the market that should fit your budget. Have your realtor shortlist some listings for you — they can help you filter the market and find the ones that are suited for your needs. Also, if you're willing to be flexible with your must-haves, you might even find a great deal to snag.

Searching for homes in Oregon is the fun part of the home buying process! You'll get to look at a variety of homes and discover what you really want in a home.

Make a list of everything you want in a home and prioritize them. At the top of the list should be the items that are most important to you. This will help you separate your "must-haves" from your "nice-to-haves."

Your agent can help you understand if your wants are realistic for your budget and favorite neighborhoods or if you need to rethink what you're looking for.

Look at current housing inventory

The timing of your house hunt in Oregon can have a big impact on your number of options. For example, in Oregon, June has historically seen the most homes for sale. Searching in this season could give you more options and a greater likelihood of finding your dream home.

On the other hand, December gives you the fewest choices in Oregon. Historically, there are 57.1% fewer homes for sale than during Oregon's peak season.

Housing inventory in Oregon by season

Season
New listings per month
Spring
7,206
Summer
7,795
Fall
5,794
Winter
4,485
Based on data from Realtor.com (August 2022)

Step 6: Make an offer

🔑 Key takeaway:

There has been a spike in demand in Oregon, so expect there to be a lot of competition if you find a great listing. For the best results, we recommend considering an offer as soon as the same day of viewing to get ahead of the other buyers who want the same property. Work out your contingencies and concessions with your agent so you can put in a competitive offer that can get your seller’s attention.

Once you find a Oregon house you love, it's time to make an offer. Your real estate agent will help you write a compelling offer that gives you the best shot of convincing the homeowner to sell to you.

Currently, in Oregon, homes stay on the market for 59 days before going under contract. However, every market goes through seasonal changes. During busier months, homes get snatched up more quickly than others.

Historically, Oregon homes sell fastest in June, where the average property is only on the market for 44 days. If your home search falls around this time, you should be prepared to move quickly and potentially make offers on several homes before yours is accepted.

On the other hand, if you buy in January, you have a bit more time to search. Homes typically stay on the market 21 days longer than Oregon's annual average.

Average time homes spend on market in Oregon

Annual average
59 days
January
81 days
February
69 days
March
51 days
April
44 days
May
43 days
June
42 days
July
46 days
August
50 days
September
55 days
October
60 days
November
66 days
December
76 days
Based on data from Realtor.com (August 2022)

» LEARN MORE: What should an offer include?

👋 Next Steps: Talk to an expert!

If you're weighing your options for buying or selling a house, Clever can help!

Our fully-licensed concierge team is standing by to answer questions and provide free, objective advice on getting the best outcome with your sale or purchase.

Ready to get started?

Give us a call at 1-833-2-CLEVER or enter your info below. Our concierge team will be in touch shortly to help.

Remember, this service is 100% free and there’s never any obligation.

Step 7: Inspections and appraisals

Inspections and appraisals are an opportunity for you to better evaluate the home's condition and value before officially purchasing it. You may have an opportunity after this step to renegotiate the terms of your contract with the seller if something unexpected pops up.

🔑 Key takeaway:

  • Inspections: A licensed professional checks the house for any unseen, unexpected, or potential issues.
  • Appraisals: An appraiser hired by your lender examines the house to determine how much it's worth.

Home inspections in Oregon

Having your Oregon home inspected by a licensed inspector gives you peace of mind about the condition of the property before you commit thousands of dollars to purchase it.

Your inspector should check out the following parts of the property:

  • Roof
  • Foundation
  • Electrical system
  • HVAC system
  • Plumbing

If the home has a septic system, you should also pay for a septic inspection to make sure it doesn't have any problems that wouldn't be covered in a typical home inspection.

Oregon-specific inspections

Oregon has strict disclosure laws for sellers, but some issues with a property may go unnoticed before closing. It's strongly recommended for buyers to do their due diligence and complete specialized tests to ensure that a home is safe.

In addition to a general home inspection, homebuyers should consider getting the following tests completed as well:

  • Radon testing: Elevated radon levels can pose health risks over long periods of time. If the seller hasn't checked for radon in over a year, then it’s a good idea to do a radon test as soon as possible.

    Depending on where the property is located in Oregon, you may be eligible to receive a free radon test kit from the Oregon Health Authority. Learn more about ordering a test kit here.

    • Indoor air quality testing: An indoor air quality test will ensure that a home is clean and free from any airborne health hazards. Getting this done before you move in is strongly recommended so that you can avoid any irritants or allergens that might be affecting the home's air quality.

    Appraisals

    Appraisals determine the value of the property. If you're using a mortgage to buy your new home, your lender will order an appraisal to make sure the home is worth the money that it's loaning you.

    » LEARN: 3 options for buyers after a low appraisal

    Step 8: Close on your new home!

    🔑 Key takeaway:

    Before you close on your new home, you and your agent will do a final walkthrough of the property to ensure that it's still in the expected condition.

    On closing day in Oregon, you'll meet at the title company to complete some paperwork and settle your closing costs.

    Be prepared to spend about an hour reading and signing several legal documents, including:

    • Your final loan application
    • The deed
    • The mortgage promissory note
    • The disclosure statements

    Take your time to carefully review each page to ensure that all of the information is correct. If something doesn't look right to you, it could interfere with the title transfer or your loan application. Ask your escrow agent if you have any questions.

    After getting through the paperwork, you'll need to pay the closing costs. As a homebuyer, you can generally divide your closing costs into four distinct categories:

    • Lender fees: Fees paid to your mortgage lender for originating and underwriting your loan. These fees can also cover additional costs connected to your loan, like appraisal and survey expenses.
    • Title and escrow charges: Fees that your title company charges for facilitating the closing, conducting the title search, and providing the required documentation. Buyers and sellers often split these charges.
    • Prepaid costs: Ongoing costs of homeownership that are paid in advance. Most mortgage lenders require buyers to pay for certain recurring expenses up front, such as property taxes and homeowners insurance.
    • Other closing costs: Miscellaneous expenses that differ for each buyer. Some common expenses might include natural disaster certification fees, pest inspection fees, or real estate attorney fees.

    Buyers in Oregon typically pay 3–5% of the purchase price in closing costs. For a $518,400 home — the typical home value in Oregon — that's between $15,552 and $25,920!

    » LEARN MORE: Closing costs for buyers in Oregon

    Should you hire a real estate attorney?

    Oregon does not require you to hire a real estate attorney to buy a home. However, depending on your circumstances, you might consider hiring one anyways. If you do, treat the process similarly to hiring an agent. Interview multiple attorneys and proceed with the one that best meets your needs.

    Frequently asked questions

    1. Save for down payment
    2. Get pre-approved for a mortgage
    3. Choose your preferred Oregon neighborhoods
    4. Partner with the right real estate agent in Oregon
    5. Go house hunting
    6. Make a strong offer
    7. Inspections and appraisals
    8. Do a final walkthrough and close

    Yes! The Oregon Bond Residential Loan Program offers a Rate Advantage program and a Cash Advantage program. They both provide competitive interest rates, but only the Cash Advantage program offers a down payment assistance loan of up to 3% of the home purchase price.

    First-time buyers are eligible for both programs. Income and purchase price limits apply and vary by county.

    » READ: What are the top first-time homebuyer programs?

    Related links

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