Oregon Faces Massive Housing Challenge: Nearly Half a Million Homes Needed in Next 20 Years

Oregon will have to build nearly half a million new homes over the next two decades to keep pace with population growth and changing demographic expectations.

This is revealed in the newly published Oregon Housing Needs Analysis report that was presented to lawmakers by a state economist. Lawmakers heard that 494,503 homes must be built statewide over the next 20 years if Oregon is to resolve its current housing shortage.

Greatest Housings Needs are in Willamette Valley and the Portland Metro Area

The greatest need for housing is in the Willamette Valley Region and the Portland metro area. The Willamette Valley Region has been identified as the area with the highest need for new housing, with 136,421 units called for over the next 20 years.

The report says the 20-year total for the Metro region amounts to 188,276. In Portland, an additional 2,851 units must be built in the next 12 months, with a total new housing stock of 57,019 over the next 20 years.

Although Governor Tina Kotek set 36,000 new homes a year as her goal, Oregon has experienced a downward trend in new housing stock for several years.

By November 2024, little more than 13,000 residential permits were obtained by builders for the year, with 20,000 permits issued in 2022, dropping to 18,000 in 2023.

Building permits hit an all-time high in 2005 when more than 31,000 permits were issued to builders.

However, the 2008 housing crash and recession put the brakes on residential development. Only about 7,000 homes were built statewide in 2009, and Oregon has never regained the impetus to achieve 1990s housing stock levels since the pandemic struck.

Oregonians Struggle to Afford a Home

Economics is the reason given for the downturn in the home-building industry, as Oregonians continue to struggle to afford a home to rent or to buy.

Meanwhile, the population increased by almost 11% between 2010 and 2020, more than all but 10 other states.

There are now more than 400,000 residents in Oregon compared to 2010, while communities have failed to build enough homes to keep pace with demand.

Another growing housing problem is the need to rehouse homeless people. According to the 2024 Point in Time count, there were 22,875 Oregonians living in shelters or on the streets. However, homeless advocates say that number is inaccurate because it does not include people living in less visible places.