The median price for a home in Clatsop County, Ore., has surpassed $300,000, breaking a record set before the Great Recession and illustrating an ever-growing gap between the market value of real estate and what many locals can afford.
Zillow's home value index tracks the change in home prices by county and metro areas. Homes in Clatsop County were worth $303,900 as of November, according to the real estate firm, up nearly 10% from a year ago.
Home values have increased nearly 50% from the trough of the recession six years ago, when they neared $203,000, and more than 8% from the pre-recession peak of $280,600 in June 2007.
Zillow's average home values do not capture all of the costs of purchasing a house, or the differences between working-class cities and wealthy coastal enclaves. According to data from the Clatsop Association of Realtors, homes last year closed for an average of $318,893 in Astoria, $327,478 in Warrenton, $353,646 in Seaside, $530,561 in Gearhart and $637,312 in Cannon Beach.
Bob Woodford, a senior loan officer with Bank of the Pacific, who has been servicing mortgages for 40 years, said he has witnessed the decline in affordability. Two people working full time used to be able to afford a mortgage on the North Coast, but homeownership is increasingly out of reach, especially for people in lower-paying service sector jobs.
An increase in housing prices is commonly driven by economic development and improving incomes, but not on the North Coast.
"We have an influx of income for a few months out of the year," Woodford said of the tourist season. "We're two hours from Seattle, an hour from Portland. That's really the only justification we have with our real estate prices continuing to go up. We don't have any economic boom here. We haven't had any huge mill come in."
A 30-year mortgage payment on a $323,000 home would cost just over $2,000 a month with a 10% down payment, a nearly 4.9% interest rate, taxes and insurance, Woodford said. The borrowers would need a verifiable income of nearly $69,000 a year, a tall ask for many working families.
"You almost have to have a logger, or a fisherman or a mill worker, and then a wait staff or a motel-hotel worker," Woodford said. "The two of them will maybe get up into that $60,000-$65,000 range where they can actually afford a house payment."
Andrea Mazzarella, a former service sector employee, has been a real estate agent for two years, now with Remax River & Sea. She focuses largely on first-time homebuyers, many with budgets of $250,000 or less.
"Typically houses $250,000 and under, and really anything under $300,000, will get multiple offers," she said. "There's more buyers than we have homes in that price range, especially."
Her clients often submit handwritten letters about their lives and dedication to the community, along with photos of their families, in the hopes of standing out. A big part of getting houses for locals amid out-of-town competition is educating sellers about the importance of legacy and supporting the community, she said.
"The part that gets me feeling like a crazy person is when I see people wanting to make decisions elevating tourism, but not realizing people who work in the tourist industry can't afford to live here," she said.
Lower-income buyers have some sources of federally backed, low-interest mortgages, such as a the Federal Housing Administration and U.S. Department of Agriculture. The challenge, though, is finding houses at a low-enough price to qualify.
Among its other programs, Community Action Team provides grants of up to $15,000 for down payments and closing costs to first-time buyers making no more than 80% of the area median income — $49,600 for a family of four. Cindy Peake, a homeownership and housing specialist with the group, said the program helps about two people a month but faces the same challenge of finding houses inexpensive enough.
Home prices and sales are slowing nationally as many potential buyers are priced out. Industry forecasts are showing a similar slowdown locally, Woodford said.
"We'll probably dip down in the near future," he said. "Will we go back down into the ($200,000 range)? I don't think that we will. I just think the speed at which we recovered can't be sustained."
But how to create housing that working-class people can afford is still elusive.
"The challenge right now is that affordability factor," said Debbie Morrow, an executive officer for the realty association who monitors transactions. "Typically new homes being built right now, they're more of the higher-end homes. When you have issues like labor shortages, and you have the tariff issue, the high cost of construction, builders are building more of the high-end homes because they need to be profitable."
She and Woodford have pointed to a need for more modest, smaller homes, along with condominiums and multifamily developments that can help hold housing prices down. Developers are starting to better understand the need for lower-cost options, Woodford said.
"People just want a house that will keep them warm," he said.
