Oregon Fix and Flip Lenders

Oregon Residential Fix & Flip Insights from a Local Lender

Similar to many other states, the lack of inventory and rising interest rates in the real estate market, has become a real challenge for residential fix & flip investors in Oregon. According to Zach Smith, principal and senior lender for Cetan Funds, many investors are having a hard time finding deals that will give them a satisfactory profit margin. He states that “properties in certain price points are not selling as quickly as they were. Days on market are now stretching 30, 60, 90 days, sometimes longer depending on what price point you’re in. So it’s far more difficult to sell the property and get to that end profit.”

Zach explains that given these circumstances and challenges, many fix & flip borrowers have come up with a new strategy, where they focus on doing more light rehab flips, which will allow them to gain a quicker profit. “A lot of our borrowers are drifting toward more of a light cosmetic type of project, something that they can move extremely fast on, and something that’s not going to take a lot of time investing in permits, and adding square footage or changing floor plans,” he says.

According to Cetan Funds, they’re also seeing a growing interest in properties that have the potential for middle housing land division. The state of Oregon recently passed legislation allowing for middle housing land division in efforts to create more affordable units. This gives investors the opportunity to convert a single family residential property into a duplex, triplex, or fourplex that can be individually sold. Zach explains that this has become a huge trend in Oregan where borrowers take a parent single family lot and divide it into child lots which they condominium, set up an HOA and then sell them off individually. He says, “a great example is taking a single family home with a detached ADU, dividing off the ADU, and now you have two properties that can be sold separately.”

Popular Markets for Oregon Residential Fix & Flip Investors to Consider

According to Cetan Funds, there is residential fix & flip activity all across Oregon, but in particular, the busiest market areas are Eugene in Lane County, Salem and the Portland Metro.

Zach states that they do see some activity along the Oregon coast as well, mainly in Florence, Newport, Lincoln City, all the way up to seaside Astoria, but most of the fix & flip projects tend to be in the major metro areas that are slowly getting gentrified, especially on older or smaller bungalow type properties. He says, “we’re in desperate need of affordable housing. So that’s where a lot of investors tend to focus on, in those pockets of these major metro areas in the state of Oregon, where they can stick to affordable price points, which in our market tend to be $400,000, maybe $350,000 or less, depending on where you’re are.”

The Mid-Willamette Valley in Oregon is another popular area for residential fix & flip borrowers, particularly Albany, Lebanon and Sweet Home. Zach explains that “in those locations, buyers can find properties with a little bit more room, some acreage and again, at a lower price point. So there tends to be some pretty good opportunities for flippers in those markets as well.”

Cetan Funds is a real estate loan originator and private money lender in Oregon. They offer services to real estate developers, builders, and investors on Fix & Flip Rehab Loans, Ground-up Construction, Investment Property Bridge Loans, Short-term Refinances, Land Acquisition & Development and Bare Land and Lot Loans. They are a good fit in particular for funding high value-add opportunities with heavy rehab or construction component to them.

For their new rehab borrowers they go up to 75% of the after repair value or 90% loan-to-cost (purchase and rehab combined). For some of their repeat borrowers who do a lot of projects with them, they will consider going up to 100% loan to loan-to-cost. View their profile to find their contact information and learn more.

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