Oregon had a broad appeal to the business community a couple of years ago. The Beaver State attracted numerous relocation deals among manufacturing companies and drove a lot of people to relocate to the state. But the crisis entirely changed Oregon’s story. As the local economy crunched, employment severely declined. The hardest hit industries were wood products, home furnishings and home construction.

Home buyers have also retreated from the market thereafter. The result is a massive supply of foreclosed houses waiting to be picked up by bargain hunters either through for-sale-by-owner, broker-assisted or the more popular home auction scheme. Despite all these, the state is expected to rebound sooner than other states in the Pacific Northwest.

In Medford, the economy is running a bad course since the automotive industry has been on a dismal performance. The lack of demand for existing home inventory has pulled down home values by double-digits. In fact, more foreclosures are on the way once adjustable rate mortgages reset this year. RealtyOutlook.com estimates home prices to drop by 12.5 percent and would further put buyers off the fence.

Portland’s real estate market has never seen any worse condition that today’s. Buyers are moving at a slow rate of picking up the existing home inventory and this is expected to linger throughout the year. As borrowers succumb to losing their homes by foreclosure, home values have continued to dip as the heavy supply continues to depress home prices. RealtyOutlook.com forecasts a 13 percent drop in average home values this year following an observed trend in some of local supply’ price cuts by 50 percent.

Salem has a similar fate with Portland, that being affected strongly by the crisis. The third largest city is currently short on vision as home values are depreciated by too many supplies but very few takers. It’s a buyers’ market in the Cherry City and RealtyOutlook.com projects home values to go down by 13.5 percent this year. Four years ago, the city experienced higher incidence of job cuts but failed to recover eventually losing ground in its manufacturing and technology industries.

Bend in Central Oregon has its homebuyer trends cooling like its tourism-related businesses. Back in 2005, the city became a favorite destination among retirees and young professionals alike. The business environment also prompted an uptick in home construction, eventually bolstering the incomes of home builders and suppliers. But just as the double-digit appreciation in home values happened, Bend’s property market came relegated to a weaker status when foreclosures filled the market. This year, home values will be plunging by 14.5 percent, a hard payback from its property boom not too long ago.

Like other cities that caught up with the real estate boom, Eugene, original home of Nike Inc., has received tremendous buyer turnout for single-family units and condominiums. But as the credit crisis spawned loan providers’ extreme restrictions, the local property market went on a downhill. Mass layoffs are experienced in retail and technology firms will occur this year once the economy remains shuddered by the crisis. RealtyOutlook.com expects home values to sink by 12.5 percent this year.

On the central western part, Corvallis’ property market is supported by student housing demand in Oregon State University and Linn-Benton Community College. High technology companies are also spurring real estate needs for its employees. However, the general market condition isn’t a strong as it is perceived to be. Total home sales are pushing the breaks as the economy turns ever sourer. Expect home values to drop by 11 percent.