Jackson County home prices followed familiar trend lines during the second quarter, rising 8.2 percent year-over-year.

The general appreciation has rocketed at an even greater rate dating back to 2012.

Southern Oregon Multiple Listing Service reported Friday that the median existing single-family residential sale price of $265,000 from April 1 through June 30 is 63.6 percent higher than the $162,000 median five years ago.

The soaring prices might raise eyebrows, but look no farther than federal mortgage underwriter Fannie Mae to see who's fanning the flames.

This month, the government-owned lender loosened underwriting guidelines so that its automated underwriting system will approve applications with a debt-to-income level of 45 percent, with the flexibility of reaching 50 percent for certain loans with strong compensating factors.

If you bring in $3,000 monthly and have obligations of $1,350, and put 20 percent down, you're likely on your way.

"We will verify, but the computer does the thinking for you," said veteran Medford mortgage lender Guy Giles, who is affiliated with Bank 34 in New Mexico. "That was pretty much unheard of six months ago, or even three days ago."

With 30-year-fixed interest rates hovering in the high 3-percent to low 4-percent range, depending on credit ratings, a $300,000 house remains attainable for buyers who may not be able to afford it if interest rates rose 2 or 3 percent.

"Good or bad, we're starting to see a loosening up of guidelines," Giles said. "But we're not going back to sloppy lending. We're still verifying stated incomes."

Coldwell Banker Pro West Real Estate agent Ron Galbreath began selling houses when mortgage rates were in the 11-percent range. He's well aware of the upward pressure low rates put on home prices.

When there are more buyers than the inventory can handle, it creates a flurry of activity when new listings hit the board.

"Right now, one in three homes that hit the MLS in San Francisco are sold sight unseen," Galbreath said.

In turn, sellers exiting the Bay Area, and other parts of California, head to places such as the Rogue Valley.

"It may seem housing is getting too expensive, too fast," he said. "But the reality is people coming from California don't have another recession in them. Even if there is a correction, they're not going to sit around this time. They're going to be too old to enjoy it here if they wait it out. They'll come no matter what, and the market is going to be strong into the future."

— Reach reporter Greg Stiles at 541-776-4463 or business@mailtribune.com. Follow him on Twitter at www.twitter.com/GregMTBusiness, on Facebook at www.facebook.com/greg.stiles.31.