It’s the worst time to buy a home in a generation, U.S. survey shows

Disclaimer: This post is meant to be used for educational purposes only and does not constitute legal or financial advice. If you are considering a real estate investment in Oregon, HomeLight always recommends doing your own research to determine which investment option is best for your situation.

Investing in real estate can be a great way to earn money over time. While this type of investment won’t win you loads of cash right away, if you keep at it you can find success and hopefully invest in more properties. There are multiple strategies for real estate investing, but experts suggest that you pick one strategy and stick with it.

One great place to look for investment properties is in Oregon. “Oregon is rapidly growing and developing and there’re so many opportunities for real estate growth because we have this state-of-the-art healthcare education and then there’s the whole leisure market,” says Betsy Shand, a Portland area real estate agent with 23 years of experience.

The state is also seeing above-average population growth. Oregon’s current population growth rate is 0.89% which makes it the 22nd fastest-growing state in the country. And Shand notes that the rental demand is particularly high right now, meaning real estate in Oregon will likely see continued value increases.

We gathered intel on the top places to invest in Oregon real estate. And, we’ve also got some helpful tips to help you find the right property for you.

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Choosing the right property

Investing in real estate isn’t just about finding the right location, but location does matter. A good investor understands how to evaluate all the factors in a property to determine if it will be a good investment. Real estate investors can use many different formulas to determine the potential return on investment (ROI) of a property, but ultimately every formula will look at gain minus cost. This means calculating how much you will earn versus how much you will invest into the property.

While investing in anything is always a risk, if you know how to assess an area and potential properties for their earning potential, you will be able to make a more secure investment. Here are the main factors of location that typically affect the ROI on an investment property:

  • Desirable area: Location, location, location. This old adage most certainly applies to shopping for investment properties. You want to purchase a property in an area that is not only desirable now, but is predicted to be desirable in the future. Look at factors like job growth predictions and population growth projections to determine if an area is on the rise.
  • A growing economy/job market: This often goes hand-in-hand with a desirable area, but a growing economy means the value of your property will likely go up over time. It also means more people moving to the area and a higher demand for real estate and rentals. On the contrary, if you research an area and find that the economy is not doing well, the value of properties may go down and it likely isn’t a good place to invest.
  • Population growth: A growing population means increased demand for both rentals and real estate. Whether fix and flips or rental properties are your jam, population growth matters. You want to have a large body of people to pull from if you need to sell your property or replace a tenant.
  • Average rental rates: The exact rental rate number isn’t what matters so much as how it compares to your other costs. Evaluate average rents in the area and use your investment formula to determine if that rental rate works with your formula to give you a positive ROI.
  • Your experience: “We’re always looking for the right property and it goes along with the right person,” says Shand. She suggests that the best area to invest in is different for each person. You should look for the areas you are familiar with and understand. Then you can capitalize on your experience to get the best ROI.

Best cities in Oregon to invest in real estate

The Beaver State has a lot to offer when it comes to real estate. From college towns and large cities to suburbs and outdoor adventure destinations, investors have a wide variety of locations to explore in Oregon. And demand for rental properties is high throughout the state.

“We have a lot of recent graduates and professionals and people with employment and education opportunities that want to be here and it’s a young group of people,” says Shand. She adds, “And we have an older group of people who have done quite well and have a lot of equity in their property and they’re ready to go to the warmer states.”

These population changes mean the area is ripe for real estate investment potential.

Ready to dig into Oregon real estate? Check out these cities:

Aurora

Located in Marion County, Aurora has seen steady population growth over the past 20 years and expects to see even more growth going toward 2029. While properties are in the higher cost range, their value is expected to see a continued increase as surrounding cities continue to become more densely populated and see a rise in real estate prices. Investing in a more rural area like Aurora could be a great game plan for investors looking to stay in the game longer.

Median home list price: $950,000
Average rental rate: $1,160/month (for a 2-bedroom)
Population size: 1,144

Beaverton

With both a population growth rate and a rental rate that’s higher than the Oregon state average, Beaverton is a great place to look for real estate investment properties. The community is a suburb of Portland located just seven miles west of the city. This proximity and the city’s own businesses — like the Nike headquarters — make for a strong economy.

Beaverton also boasts a community full of attractions like restaurants, wineries, local businesses, and outdoor activities.

Median home list price: $585,000
Average rental rate: $1,811/month
Population size: 98,216

Corvallis

A college town with a vibrant history, Corvallis is a great place for fix and flip investors. Whether flipping properties to rent or to sell, you can find lots of historical properties with potential.

College students and families provide a plethora of renters. And, Corvallis is a tourist destination in the Willamette Valley known for its vibrant outdoor adventures and lush wine country. You can find many opportunities for real estate investment here.

Median home list price: $561,500
Average rental rate: $1,674/month
Population size: 59,864

Eugene

Home to the University of Oregon, Eugene’s status as a college town means a steady stream of renters flowing in and out. It’s also a desirable city for families with easy access to outdoor recreation areas and a thriving culinary scene.

With average home prices lower than the average list price in Oregon, real estate investors with a lower budget can find properties in this area. It’s more affordable than Portland, but still offers the benefits of being in a larger city.

Median home list price: $499,900
Average rental rate: $1,717/month
Population size: 175,096

Hillsboro

Just 30 minutes outside of Portland sits a historic community with a growing tech scene. Hillsboro is known as the “Silicon Forest” and has a lot to offer residents. As home to Intel headquarters, the city only expects to see continued growth as the city works to attract more businesses. With a higher rental rate than many of the surrounding areas, investors can expect to see a hefty ROI when purchasing the right property in Hillsboro.

Median home list price: $549,900
Average rental rate: $2,062/month
Population size: 106,633

Lyons

Lyons is a smaller community with big real estate potential. “There’s a lot of people spreading out looking for those houses where the prices are considerably less than it would be in Portland,” says Shand. Lyons is one of those areas where this is true. The town of Lyons is located about an hour from Portland and just 30 minutes from Salem.

Median home list price: $447,500
Average rental rate: $1,152/month (for a 2-bedroom)
Population size: 1,210

Medford

Medford has a substantial plan in place to achieve economic growth and resilience for the community. Investments in the community like this mean the area is likely to see growth as the city invests in its future. With lots of outdoor recreation activities, Medford’s proximity to outdoor recreation activities draws both tourists and residents alike. All of these factors add up to a great place to invest in real estate at a reasonable price.

Median home list price: $433,000
Average rental rate: $1,450/month (for a 2-bedroom)
Population size: 86,367

Portland

Like any location, Portland has seen ebbs and flows in real estate demand, but as the largest city in Oregon with a strong economy, the city will continue to be a great place to invest in real estate. It’s a particularly good place to invest in multi-family units. The multi-family market was quite competitive for a while but there are now more properties available, and the thriving economy means a steady supply of renters will continue to be available.

If you prefer to invest in short-term rentals, Portland would also be a great place to invest. The city saw 11.3 million overnight visitors in 2021. Its vibrant food and culture scene draws visitors from all over the world.

Median home list price: $549,900
Average rental rate: $1,746/month
Population size: 641,162

Salem

Steady growth is the name of the game for real estate investors, and Salem’s got it. The state’s capital and second largest city, Salem’s central location makes it a great spot for many types of real estate investors. With close proximity to Oregon’s mountains, beaches, and large cities of Portland and Eugene, Salem has a lot going for it.

And real estate prices aren’t as high as in some of the other areas in Oregon, meaning it’s a great place to invest if you don’t have as much cash to dole out.

Median home list price: $449,000
Average rental rate: $1,349/month
Population size: 177,723

Look long-term as an investor and plan an exit strategy because we say that you don’t just make money buying and selling real estate. You make money owning it.

Tips for finding a great investment property in Oregon

There are lots of great places to look for real estate in Oregon. However, focus on places within your budget and also where you have the most experience and understanding of the market to have the most success. Also, follow a few key tips to find a great investment property.

  • Partner with an expert real estate agent: Teaming up with an expert will help you get insider advice and know the ins and outs of your market better. Find an agent with experience in real estate investment to help guide you through the process of finding a great investment property in Oregon.
  • Understand your local laws: Every state, region, and city has its own laws around real estate and rentals. “We do have a number of regulations around purchasing and we do have some restrictions on introducing cash into the transaction,” says Shand. Make sure you know what the laws are and how they will impact your purchase.
  • Leave room in your budget for maintenance: Any property you purchase will likely need some form of maintenance. Whether it’s a large renovation or some routine updates, understand the costs of what the property needs. It would be unfortunate to spend all of your money on the property only to find out it needs costly repairs right away.
  • Plan ahead: “Look long-term as an investor and plan an exit strategy because we say that you don’t just make money buying and selling real estate. You make money owning it,” advises Shand. It’s important that you know not only how you will start investing, but that you know your plan long-term so that you know what you need to do along the way.

Ultimately, do your research and know your market so that you can plan accordingly for your investment. Smart real estate investors look ahead and have a detailed plan before they make a purchase.

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