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Residential Department: Spotlight: Oregon: May 2016

 

Spotlight: Oregon

The Beaver State’s economy is driven by tech culture and agriculture

With port cities along the Pacific coast, strong roots in agriculture and a fast-growing Portland metropolitan area with a blossoming tech industry, Oregon’s economy is an impressive mix of old and new — and it is growing rapidly.

In 2014, the state’s gross domestic product (GDP) was $212.8 billion, and its real GDP expanded by 2.4 percent over the previous year, outpacing the nation’s 2.2 percent growth.

The U.S. Census Bureau estimates that, last year, the state’s population topped 4 million for the first time. Much of the growth has come in Portland, the state’s largest city and one of the fastest-growing metros in the nation. From 2010 to 2014, the Portland metropolitan area’s population grew by more than 5 percent, to an estimated 2.35 million. Some of that growth can be attributed to the city’s strong technology ties, as the Oregon Office of Economic Analysis found that Portland ranks 14th among major cities for its concentration of “core” tech-based jobs.

Despite Portland’s booming tech industry, agriculture still brings in billions of dollars to Oregon and is a major factor in the state’s economy. As of 2014, the state had nearly 35,000 farms encompassing a total of 16.4 million acres. It also ranked as the top state for production of blackberries, boysenberries, hazelnuts, ryegrass seed and Christmas trees, according to the Oregon Department of Agriculture.

Agriculture also plays a major role in two of Oregon’s most well-known industries: wine and beer. Thanks in large part to the famed Willamette Valley, the state has more than 600 wineries and ranks fourth nationwide in the production of wine grapes. Oregon also ranks first nationally in breweries per capita and in the percentage of money spent on craft beer, and is second nationally in the amount of hops grown. Wine and beer combine to contribute more than $6 billion to the state’s economy, directly and indirectly.

The state’s manufacturing output also is among the nation’s 10 largest, according to the National Association of Manufacturers. In 2014, that output was more than $55 billion, accounting for a quarter of the state’s GDP. Most of that comes from the manufacturing of computer and electronic products. The state manufactured more than $38 billion of those goods in 2014.

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Portland Home Sales

Portland Metro Area Existing-Home Sales

Oregon’s largest city, Portland, has been recognized as being one of the hottest housing markets in the United States, and the statistics bear that out. More houses were sold in Portland this past December than in any December since 1992 (when monthly statistics were first kept), and inventory fell to just 1.2 months, according to the Regional Multiple Listing Service.

The market was never hotter than in mid-2013, when the average existing home was on the market for just 16 days before selling, but even by the end of 2015, the average existing home was on the market for just 39 days and sold for $305,000. Nationwide, houses were on the market for an average of 58 days before being sold, according to National Association of Realtors data from this past December.

Delinquencies and foreclosures

Oregon Foreclosure Fillings. Source: RealtyTrac

Oregon has one of the lowest foreclosure-inventory rates of any state with a judicial foreclosure process. CoreLogic reports that, this past January, 1.2 percent of Oregon homes were in foreclosure — with the state’s total foreclosure inventory down more than 25 percent from January 2015. The serious delinquency rate for homes in the state stood at 2.6 percent. Nationally, 3.2 percent of homes were in serious delinquency, the report shows.

RealtyTrac data reveals that the overall number of foreclosure filings in Oregon stayed relatively steady throughout 2014-2015, although there was some fluctuation in the detailed numbers. Default notices increased by roughly 50 percent between second-quarter 2014 and fourth-quarter 2015, and the number of bank-repossessed properties nearly doubled, but the number of auction notices decreased significantly over the same period.

Unemployment

Since reaching a peak of 11.9 percent in May 2009, Oregon’s unemployment rate has steadily declined, but it remains higher than the national average. At the end of 2015, Oregon’s unemployment rate was 5.5 percent, as opposed to the national rate of 5 percent. There is, however, optimism that Oregon’s rate will continue to improve, perhaps more quickly than the rest of the nation.

According to the state’s Economic and Revenue Forecast, Oregon added more than 57,000 jobs in 2015, an increase of 3.3 percent from the previous year and the highest growth rate since the mid-1990s. Average wages remain lower than the national average, but are at their highest point — relative to the national rate — since the early 1980s.

Sources: CoreLogic, Fodor’s, Forbes, Full Glass Research, National Association of Manufacturers, National Association of Realtors, Oregon Craft Beer, Oregon Department of Agriculture, Oregon Metro, Oregon Office of Economic Analysis, Realtor.com, RealtyTrac, Regional Multiple Listing Service, Smithsonian, The Oregonian, U.S. Bureau of Economic Analysis, U.S. Bureau of Labor Statistics, U.S. Census Bureau, Zillow

 

3 Cities to Watch

Eugene

Eugene is home to the University of Oregon. It is also known as “Track Town, USA,” for its running-friendly environment and infrastructure, and for the number of famed runners who made their way through Eugene, such as Steve Prefontaine. This past February, the median list price for Eugene homes was nearly 10 percent higher than the previous year, according to Realtor.com.

Bend, Oregon

Bend

Located in the high desert of central Oregon, Bend is considered an outdoor-lovers paradise, offering great skiing, hiking, biking, mountain climbing, golfing and more. It also has become home to several booming tech companies, which is making it a desirable place to live. According to Zillow data, the median sales price for a home in Bend has climbed from $197,000 in January 2012 to $326,000 this past January.

Ashland

Perhaps this town of 20,000 is best known for its world-renowned Oregon Shakespeare Festival that draws thousands of visitors each year, but there are plenty of other things to like about Ashland. In recent years, Fodor’s and Smithsonian magazine have named Ashland as one of the best small towns in America, thanks in large part to its quaint homes, the nearby mountains and its lush forest surroundings.



 

What the locals say

“A lot of [Oregon’s growth] has to do with millennials wanting to relocate here, frankly, and getting out of the higher-priced markets in California, in particular. It’s more of a lifestyle-driven move. Last year, 69 percent of the moves were inbound. We just don’t have a lot of people leaving.”

r_2016-05_Spotlight_local
Bob Engelke
Oregon state manager,
Guild Mortgage Co.






 

Rob Crow was online content editor for Scotsman Guide Media. For questions regarding this article, e-mail articles@scotsmanguide.com.

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