Boise Real Estate Market Report for December 2018

Sales Continue to Slide but Prices at Record Level 

The Boise Real Estate Market in December was marked by sharply falling sales and sharply rising prices.  An odd couple to say the least. December’s 14.8% decline was the fourth in the last five months and sales for the most recent quarter combined are off 10.5% versus last year. Also for the 2nd straight month, after literally years of declines, the number of homes for sale was up 5.7% and pending sales, an indicator of future market activity were off 5.1%. Normally this would be bad news for sellers and at some point this will likely be the case, but for now prices seem unaffected by the drop in sales and are at record or near record levels. The average price per square foot was up 17% to $172/sf., a new record.  Meanwhile the average sales price was $363,000 (+16% )second only to the $368,000 recorded in August.  Even as the trend of declining sales has deepened the rate at which prices are rising has accelerated.  In November the average price per square foot and average sales price were up 12.3% and 13.6% respectively.

Conventional wisdom would say that a drop in sales is somehow a result of a drop in demand and that at some point prices should reflect that.  Until recently though it seemed a lack of supply was the primary market force keeping sales in check.  The demand was there but there was nothing to buy.  Now although inventory is still very low by historical standards we are seeing the number of homes for sale rise compared to a year ago with no apparent effects on the upward march of prices…so far.  Current inventory based on the rates of homes selling stands at 2.2 months the highest in almost a year, while the average days on market is 41 a 4.7% decline from last year. As a reminder, 6 months of inventory and 60 days on market are widely seen as indicative of a stable or “neutral” market as far as how much leverage buyers and sellers have.  So we are still in a strong seller’s market despite the sharp drop in sales. Continued in migration, stabilizing interest rates, and a generally strong local economy and job market seem to be enough to keep the party going.

SUMMARY BOISE (ADA COUNTY) MARKET STATS FOR DECEMBER  2018

*Does not include manufactured homes **see detailed graphs below for more information.

 

Type # Sold % +/- % of Total Sold # For Sale % +/- % of Total For Sale $/SF % +/- Average Sold Price % +/- Days on Market % +/- Months Inventory
All 750 -14.8 100 1640 +5.7 100 $172 +17.0 $363K +16.0 41 -4.7 2.2
New Construction 256 +11.3 34.1 1019 +14.0 62.1 $175 +10.1 $413K +9.0 57 +1.8 4.0

 

Canyon County 312 -9.0 100 641 -14.5 100 $136 +13.3 $250K +16.3 38 -9.5 2.1

One other area in the latest Boise real estate market numbers worth pointing out is the role of new construction in the current mix of homes for sale and being sold.  While overall sales were down 14.8%, sales of new homes ( not including custom build jobs) were up 11.3% and the number of new homes for sale jumped 14% versus last year. The 256 new homes sold in December was 34.1% of all homes sold while the 1019 new homes for sale represented 62.1% of all homes listed. Without new construction the market would be in serious trouble on the supply side.  For example, sales of pre-owned homes were off 24% in December and 10.5% for the most recent quarter.  This may be helping boost prices as newly constructed homes tend to be priced above the overall market average.  Currently the average price per square foot for new construction is $175 (vs $170 for re-sale homes), while the average sales price for a newly built home is $413,000 (vs. $337,000 for re-sale).

Based on what is happening in other markets around the country and predictions for a nationwide economic slowdown and possible recession in the coming months, I still believe that the current double digit price increases are unsustainable and we will see a gradual flattening of the price curve in the coming months.  Supply for the time being will likely stay pretty tight even with all the new construction occurring because there hasn’t been a strong enough trigger to get existing homeowners to sell.  Many who would like to sell and take a profit are worried that they won’t be able to find a replacement home that meets their needs and their budget.  Until sellers feel like they may be missing out on peak pricing if they don’t sell we will continue to see very few existing homes on the market compared to historical averages.

Please feel free to contact me with you comments and questions. 

Cam Johnson

Realtor®

Windermere Real Estate/Boise Valley

1412 W Idaho St.

Suite 120

Boise, ID 83702

208-258-2222 Office

208-283-3664 Cell

208-258-2230 Fax

camjohnson@windermere.com


Posted on January 15, 2019 at 3:03 pm
Cam Johnson | Posted in Monthly Real Estate Market Reports | Tagged , , , , , , , , , ,

Boise Real Estate Market Report for November 2018

Volume Continues to Drop, Prices Slow to React

First, my apologies. Due to technical issues I was not able to distribute a report last month but should be back on track moving forward. Fortunately, you didn’t miss much and the overall Boise real estate market trend remains the same. Sales volume is slowing and is now below where we were a year ago while prices continue to rise, albeit a tad slower than they were during the frenzy of this past spring and summer. There were 887 closed sales in Ada County in November, 6% below November 2017 and approximately 15% below October. The drop from October is largely seasonal but the year over year drop has occurred in 2 of the last 3 months and appears to be the trend as pending sales were also down 3.7% in November. Meanwhile for the first time in literally years, the number of homes for sale was actually up 5.4% compared to last year. There were 1859 homes listed and at the current rate of sales this is 2.1 months of inventory. While still historically very low it is only the second time in over a year we have had 2 or more months of inventory. Average days on market also ticked up to 35, again still historically low and indicative of a strong seller’s market but slightly above levels we saw this summer.

In talking to other agents and brokers there has been a palpable change in the feel of the market. This is also reflected nationally. For months we have been hearing that some of the nation’s previously hot markets such as New York, Seattle, San Francisco, and Portland were experiencing a slowdown. This past week the Wall Street Journal reported that a similar shift is occurring in some smaller markets such as Las Vegas, Phoenix, and Tampa. Bidding wars have been replaced by price reductions and inventory which was non-existent a few months ago has in some cases doubled. There are also more and more predictions of a recession in 2019. Fox News (sorry) reported last week that half of US CFOs say a recession, largely trade and tariff driven, will occur in 2019. While this will likely have some effect on housing, in markets like Boise the impact may be somewhat muted by continued in-migration due to quality of life and relative affordability. For more information on the national picture please check out Windermere Chief Economist Matthew Gardner’s 2019 Economic Forecast.

Meanwhile prices in the Boise real estate market continue to go up in double digits. The average price per square foot was $167 in November, up 12.1% versus 2017, but down 2.3% from October. The average sales price was $350K (+13.6%) but this was down about 2% from October. There is some normal seasonal fluctuation in prices so the numbers I would key in on are the year vs year ones. It is also typical for prices to lag behind a shift in volume. In the case of the last big recession, the market shift occurred in 2006 but prices didn’t peak until summer 2007. While in the current scenario prices may not fall much, if at all, the rate of increase has already dropped from the 15-18% per year that we saw this summer to the 12-13% we are seeing now. I still feel anything over 10% is not really sustainable given current wage growth and inflation so if we continue to slow down it may be a good thing for the overall health of the market.

SUMMARY BOISE (ADA COUNTY) MARKET STATS FOR NOVEMBER 2018
*Does not include manufactured homes **see detailed graphs below for more information.

Type # Sold % +/- % of Total Sold # For Sale % +/- % of Total For Sale $/SF % +/- Average Sold Price % +/- Days on Market % +/- Months Inventory
All 887 -6.0 100 1859 +5.4 100 $167 +12.1 $350K +13.6 35 -14.6 2.1

New Construction 241 +15.9 27.2 1010 +14.8 54.3 $172 +5.5 $401K +7.2 50 -24.2 4.2

Canyon County 382 +0.5 100 718 -9.9 100 $139 +20.9 $248K +18.7 29 -32.6 1.9

There are likely many reasons for the market shift that has begun in Boise. The usual culprits are definitely in play here: rising interest rates, prices forcing some buyers out of the market, declining consumer confidence in the national economy. But in our market unemployment is low, wage growth is strong and in-migration continues so the overall effects may be fairly mild compared to some more volatile markets. Still, we are near what I would consider the peak of the current pricing cycle so Buyers may decide to wait for prices to possibly drop while Sellers who have been sitting out may jump in to cash out at the peak. Both those will serve to accelerate the trend—fewer buyers and more inventory. Quite the opposite of what the market has brought the last few years.

Happy Holidays to you all. Please feel free to contact me with your comments and questions.

 

Cam Johnson
Realtor®
Windermere Real Estate/Boise Valley
1412 W Idaho St.
Suite 120
Boise, ID 83702
208-258-2222 Office
208-283-3664 Cell
208-258-2230 Fax

camjohnson@windermere.com


Posted on December 20, 2018 at 1:51 pm
Cam Johnson | Posted in Monthly Real Estate Market Reports | Tagged , , , , , , , , , , , ,

Boise Real Estate Market Report for September 2018

That Predicted Market Shift?  I Think It Has Started…

For the last few months I have been describing subtle signs of storm clouds on the horizon that might lead to a much predicted shift in the market.  In September some big drops from those clouds started hitting my windshield.  Closed sales in September in Ada County (931) dropped 18.1% from a year ago, the biggest such drop since the market bottomed out in 2010-11. Furthermore sales dropped 21% in one month from August to September 2018, a much larger drop than would be expected due to normal seasonal slowdown. Pending sales dropped 3.8% while the number of homes for sales also dropped 7.3%. The drop in the number of homes for sale, while significant, is much smaller than the 15-25% drops we have become used to. As a result inventory at the current rate of sales rose to 2.1 months.  While this is still historically very low it is actually the highest it has been in the Boise real estate market in 18 months. Blame for the sharp drop in sales lies with the usual suspects: lack of available inventory, rising interest rates, and prices outpacing wage growth. Lack of affordability is continuing to force some buyers out of the market despite strong demand from out of state and repeat buyers.

Despite the drop in sales prices are still barreling ahead, but have moderated their upward spiral slightly and typically we would expect a real flattening in the price curve to lag several months behind the turning point in sales. The average price per square foot actually did drop  slightly from August to $167 but was still 12.1% ahead of September 2017.  The average sales price dropped a significant $19K from August but managed a 15.9% increase over last year.

SUMMARY BOISE (ADA COUNTY) MARKET STATS FOR SEPTEMBER  2018

*Does not include manufactured homes **see detailed graphs below for more information.

Type # Sold % +/- % of Total Sold # For Sale % +/- % of Total For Sale $/SF % +/- Average Sold Price % +/- Days on Market % +/- Months Inventory
All 931 -18.1 100 1944 -7.3 100 $167 +12.1 $350K +15.9 34 -2.9 2.1
New Construction 249 +2.0 26.7 881 +8.8 45.3 $173 +6.8 $395K +9.1 62 -1.6 3.5

 

Canyon County 379 -17.6 100 753 -23.9 100 $137 +17.1 $252K +19.4 24 -27.3 2.0

 

New construction sales continue to grow despite the overall decline in the market although in September sales were only up a modest 2% from 2017.  26.7% of all homes sold in Ada County were new in September a slight uptick from August (25.8%). More significantly, the number of new homes for sale rose 8.8% from a year ago and represented 45.3% of all available homes.  These figures do no include custom build jobs which are not typically reported in the MLS, but suffice it to say that new construction is a driving force in the market right now. If you back out new construction from the number of homes sold in September, sales of pre-existing homes dropped 23.6% compared to a year ago. Not surprisingly with the high demand for construction labor and materials, the average sale price of a new home runs about 18% higher than for a re-sale home.  The difference is actually probably larger than that if you try to compare “Apples to Apples” as far as size, condition, etc.. New construction tends to be on average larger and in better condition than older homes in established and historic neighborhoods.

Looking forward, most “experts” are predicting that current trends will continue although the pricing curve should slowly start to flatten.  It remains to be seen whether we will actually see prices drop in the next 6-12 months or merely stabilize at a more sustainable growth pace more in tune with overall inflation.

Please feel free to contact me with your comments and questions.  Also for those interested in hearing Windermere’s Chief Economist, Matthew Gardner, give his economic analysis and forecast for the Treasure Valley please plan to join us Thursday, October 25 from 10:00-11:30AM at JUMP in downtown Boise.  You can register for this free event here: https://www.eventbrite.com/e/presentation-by-matthew-gardner-windermeres-chief-economist-tickets-49746412860.

You can also just show up but be aware seating may be limited.  This was a great event last year and hope you can make it this year! 

Cam Johnson

Realtor®

Windermere Real Estate/Boise Valley

1412 W Idaho St.

Suite 120

Boise, ID 83702

208-258-2222 Office

208-283-3664 Cell

208-258-2230 Fax

camjohnson@windermere.com


Posted on October 11, 2018 at 3:07 pm
Cam Johnson | Posted in Monthly Real Estate Market Reports | Tagged , , , , , , , ,

Boise Market Report for August 2018

Sales Stutter While Prices Keep Rolling 

In August the Boise real estate market revealed some subtle signs that the wheels of a predicted market shift may in fact be starting to turn.  One month does not define a trend but there are indicators worth watching as we head into fall.  First, the number of closed sales in Ada County fell 4.2% to 1179 versus last August, not a huge decline, but the largest we have seen in quite some time.  Secondly, pending sales, an indicator of future market activity dropped 7.9% in August.  This will likely be reflected in September and October’s closings. Lastly, while still down 13.7% from a year ago the number of homes for sale increased 13.4% from July meaning there were over 200 more homes available than in the previous month.  Albeit inventories are still near historic lows but are inching up lowly.  We had 1.5 months of inventory in August up from a low of just 1.0 in May and only slightly below last August’s 1.7 months. Average days on market were a remarkable 26 days, still indicative of a very strong seller’s market.

Booming new construction in the Boise real estate market had a significant effect on the numbers and helped soften the blow of dropping sales. Sales of newly built homes increased 17.8% and were 25.8% of all sales in August.  While sales of all homes dropped 4.2%, if you remove sales of new homes, sales of pre-existing homes dropped 10.1% while the number of pre-existing homes for sale was off 25.1%.  Homeowners just aren’t putting their houses on the market and as long as prices continue to explode we can probably expect more of the same. Once the market senses it has peaked expect a wave of inventory.

SUMMARY BOISE (ADA COUNTY) MARKET STATS FOR AUGUST  2018

*Does not include manufactured homes **see detailed graphs below for more information.

 

Type # Sold % +/- % of Total Sold # For Sale % +/- % of Total For Sale $/SF % +/- Average Sold Price % +/- Days on Market % +/- Months Inventory
All 1179 -4.2 100 1771 -13.7 100 $169 +15.0 $369K +19.4 26 -23.5 1.5
New Construction 304 +17.8 25.8 799 +6.3 45.1 $175 +9.4 $418K +14.5 47 -30.9 2.6

 

Canyon County 490 -1.2 100 634 -33.3 100 $132 +14.8 $245K +16.1 26 -18.7 1.3

Speaking of prices, the stumble in closings has yet to impact upward price trends as demand remains very high. The average price per square foot rose to $169, a record high, and 15% higher than last year.  That means buyers paid on average $22/sf more than they did a year ago.  Meanwhile the average sale price was $369,000 up $10K (2.7%) just from July and $60K (19.4%) over the last year. As prices continue to soar affording a house becomes more and more difficult for some buyers particularly first timers.  Many are forced to rent in an already tight rental market here in Boise.  Oddly enough this isn’t true everywhere even in other hot markets.  Bloomberg recently published an article with the headline, “Rental Glut Sends Chills Through the Hottest US Housing Markets” describing Seattle as having the biggest drop in rental prices of the 50 biggest cities. It says there is now a glut of newer amenity rich centrally located apartments that are fighting for tenants.  So far this has not really affected Boise despite the large number of apartments going up including many downtown.

It will remain to be seen whether the drop in sales was a hiccup or a trend in the Boise real estate market, but with the national media suggesting that at least in some markets a change is already underway I’m betting we are not far behind.  Please feel free to contact me with you questions and comments. 

Cam Johnson

Realtor®

Windermere Real Estate/Boise Valley

1412 W Idaho St.

Suite 120

Boise, ID 83702

208-258-2222 Office

208-283-3664 Cell

208-258-2230 Fax

camjohnson@windermere.com


Posted on September 14, 2018 at 10:47 am
Cam Johnson | Posted in Monthly Real Estate Market Reports | Tagged , , , , , , ,

CATCH and Windermere Team Up to Help End Homelessness in Boise

Our brokerage has partnered with CATCH in several ways over the last few years to help them in their mission to end homelessness.  It is our shared belief that every family and every person deserves a home.  Here is a short video that illustrates Windermere’s commitment to helping others: Windermere Community Service Day 2018

 


Posted on August 29, 2018 at 2:32 pm
Cam Johnson | Posted in Uncategorized | Tagged , ,

Boise Real Estate Market Report for July 2018

New Construction Buoys Sales, Prices Still Sizzling

July was another scorcher in the Boise Real Estate Market despite the lack of pre-existing homes on the market. Supply woes continue to both keep sales from rising to meet demand and to keep prices soaring for those homes that do hit the market.  New construction is helping stabilize the market but we remain in an epic seller’s market.  Total homes sales in Ada County (1191) were up 3.5% from a year ago but sales of existing homes (906) dropped 1.6%.  Lack of inventory continues to be the issue.  While overall inventory of homes for sale dropped 24.4%, existing home inventory dropped 32.5%. Days on market numbers paint a similar picture—overall we are at 29 average days on market but for existing homes that number drops to 19 days. Either number would be considered historically low. Based on the current rate of sales we have 1.3 months of overall inventory but only 1.0 months for already built homes. The numbers in Canyon County are similar but even more extreme in some cases: overall inventory there is off 37.8% despite a 10% increase in sales.

As a result, prices continue their march upward throughout the Treasure Valley.  The average sales price in July was essentially unchanged from June but was up 17.3% from 2017 while the average price per square foot ticked up to $167 a 13.6% annual gain.  This is making it tougher and tougher for buyers, especially first time and/or Millennials to afford a suitable place to live.  We all have stories to tell about this but some of you may appreciate a recent story from NPR that focused on the problem by featuring Boise. Also, for more details on the market statewide please see the latest Gardner Report from Windermere’s Chief Economist, Matthew Gardner. Matthew will be coming to Boise in October to give a  detailed report on the Boise economic and real estate outlook.  More details about this event to come.

SUMMARY BOISE (ADA COUNTY) MARKET STATS FOR JULY 2018

*Does not include manufactured homes **see detailed graphs below for more information.

 

Type # Sold % +/- % of Total Sold # For Sale % +/- % of Total For Sale $/SF % +/- Average Sold Price % +/- Days on Market % +/- Months Inventory
All 1191 +3.5 100 1562 -24.4 100 $167 +13.6 $359K +17.3 29 -6.5 1.3
New Construction 285 +23.9 23.9 682 -10.5 43.7 $172 +8.9 $404K +11.0 62 -17.3 2.4

 

Canyon County 494 +10.0 100 564 -37.8 100 $131 +13.9 $252K +19.4 28 -15.2 1.1

 

So in the short term things remain rosy for sellers and really tough for buyers, but as I have mentioned previously there is some consensus building among the experts that a change is coming.  The Wall Street Journal recently featured a story on the front page with the headline “Home Sales Extend Slump Despite Economic Strength”.  Nationally, the report says, home sales have dropped on an annual basis in five of the first 6 months of the year with high prices, low inventory, and rising interest rates being to blame. The article also cites examples of the market slowing already in nearby cities such as Portland and Seattle due to buyers becoming more cautious especially at the high end of the market.  The article isn’t all doom and gloom though, saying at least for now demand isn’t the issue in most markets, supply is.  Bloomberg News took a different approach—a shovel to the face.  Their recent story was titled: The U.S. Housing Market Looks Headed for Its Worst Slowdown in Years. Rising interest rates and high prices are stretching buyers to where they just give up. The famous economist Robert Shiller is quoted in the story as saying, “This could be the very beginning of a turning point”. The story goes on to cite rising inventories in nearby cities: San Jose +12%, Seattle +24%, and Portland +32%.  It still too soon to say what and when a change will come to Boise but if history is a guide we tend to lag 6-12 months behind our larger neighbors so I am guessing we will see some sort of a shift sooner than later.

Please feel free to contact me with any questions or comments and stay cool!!

 

Cam Johnson

Realtor®

Windermere Real Estate/Boise Valley

1412 W Idaho St.

Suite 120

Boise, ID 83702

208-258-2222 Office

208-283-3664 Cell

208-258-2230 Fax

camjohnson@windermere.com


Posted on August 16, 2018 at 11:30 am
Cam Johnson | Posted in Monthly Real Estate Market Reports | Tagged , , , , , , ,

Boise Real Estate Market Report for June 2018

Low Inventory Pinches Off Sales Growth in June 

With a few minor exceptions closed sales in the Boise real estate market have continued to grow despite record low inventories but in June sales (1247) were off 4.2% from 2017 and also down slightly from May 2018.  This drop was primarily a function of lack of available choices for buyers as demand remains very strong.  The number of homes for sale at 1561 was down 21.2% from a year ago.  Inventory remains extremely tight with the average days on market dropping to 28, the lowest I have ever seen while the months of available inventory edged up slightly from May’s record low 1.0 months to 1.3 months.  By any typical method of evaluation this is an absurdly tight market for buyers right now.   While I do predict that rising prices will eventually erode the typical buyer’s purchase power to the point that the market slows down, June’s drop in sales was not driven by drop in demand but by lack of options for buyers in the market.

Needless to say given this scenario, prices continue to charge forward further into record territory.  The average price per square foot was $166 up 13.7 from a year ago while the average sales price jumped nearly $20K in one month to $363,000. Percentage wise we were up 17.1% compared to June 2017. I believe these types of numbers are unsustainable and will eventually lead to the next market slowdown probably within the next 12-18 months. As more buyers find themselves priced out of the market demand will depend more and more on the cash rich typically out of state buyer.  While for now there seems to be an almost endless supply of these that will change especially if markets on the west coast slow down as in some cases they have already started to do. Sellers trying to time the peak of this cycle should be on notice that the time is approaching and will be behind us by the time most people are aware it even occurred.  Anecdotally some of my colleagues have already commented that they seem to see an uptick in price reductions and back on market listings (likely due to appraisal issues).  While the statistics don’t bear that out currently, often the signals of a market shift are more a feeling than the numbers will reveal for a period of time.  Anyone out there getting a feeling change is in the air?  I’m personally not there but…

SUMMARY BOISE (ADA COUNTY) MARKET STATS FOR JUNE 2018

*Does not include manufactured homes **see detailed graphs below for more information.

 

Type # Sold % +/- % of Total Sold # For Sale % +/- % of Total For Sale $/SF % +/- Average Sold Price % +/- Days on Market % +/- Months Inventory
All 1247 -4.2 100 1561 -21.2 100 $166 +13.7 $363K +17.1 28 -20.0 1.3
New Construction 314 +1.6 25.2 680 -5.9 43.4 $172 +8.2 $411K +12.3 63 -17.1 2.2

 

Canyon County 499 -1.0 100 604 -26.5 100 $129 +13.2 $245K +17.2 23 -25.8 1.2

 

 

 

 

Cam Johnson

Realtor®

Windermere Real Estate/Boise Valley

1412 W Idaho St.

Suite 120

Boise, ID 83702

208-258-2222 Office

208-283-3664 Cell

208-258-2230 Fax

camjohnson@windermere.com


Posted on July 18, 2018 at 9:22 am
Cam Johnson | Posted in Monthly Real Estate Market Reports | Tagged , , , , , , , ,

Boise Real Estate Market Report for May 2018

May Was Another Hot Month For Boise Real Estate

It’s starting to sound like a broken record when I report that the Boise real estate market has broken another record. But it just keeps happening. May saw record high prices yet again.  The average price per square foot jumped to $164, up $3 from April and up $21 (14.7%)  from a year ago.  Meanwhile the average sales price also set a record at $345,000.  This is up $4,000 from April and $47,000 (+15.8%) for the year. Sellers are not only in the driver’s seat, they are in the fast lane.

The cause of these record breaking prices is no secret and has been the case for many months—extremely low inventory and very high demand. Boise continues to be “discovered” as a great place to live with good job growth and reasonable costs of living compared to our west coast neighbors.  Boise seems to make just about every list for desirability of late and people are moving here.  That coupled with few existing owners leaving or listing their homes has put us in a pinch.  While closed sales (1242) rose 12.7% in May, available inventory (1323) was down 28.3% from a year ago.  If you notice those two numbers are pretty close together meaning homes are selling almost as fast as they come on the market.  Further indication of this is that we currently only have 1.1 months of inventory, which is probably also a record.  Builders are building as fast as they can and they are definitely having an impact.  334 new homes (listed in the MLS) sold in May up a whopping 51.8%.  This number represents 26.9% of all the homes sold while new home inventory accounted for 46.2% of all inventory.

SUMMARY BOISE (ADA COUNTY) MARKET STATS FOR MAY 2018

*Does not include manufactured homes **see detailed graphs below for more information.

 

Type # Sold % +/- % of Total Sold # For Sale % +/- % of Total For Sale $/SF % +/- Average Sold Price % +/- Days on Market % +/- Months Inventory
All 1242 +12.7 100 1323 -28.3 100 $164 +14.7 $345K +15.8 36 0.0 1.1
New Construction 334 +51.8 26.9 611 -23.0 46.2 $170 +14.1 $382K +13.0 80 -12.1 1.8

 

Canyon County 512 +8.5 100 539 -28.0 100 $126 +13.5 $229K +14.5 30 -14.3 1.1

Of course the big question is how long will the market be able to maintain the current pace?  The exact timing of market swings are pretty hard to predict but there are some signs that we may be getting close to either a slowdown or possibly even somewhat of a correction.  For one, we have seen prices rising for seven solid years in a row. Secondly, interest rates have risen modestly and there are indications they will rise further especially if inflation picks up. Thirdly, as prices continue to rise and inventory remains low more and more people will either get priced out of the market or simply give up looking.  This doesn’t seem to have deterred many of the cash heavy out of state buyers looking to move here.  Those buyers ability to make the move to Boise hinges on their ability to sell for a large profit in the current home markets, particularly the west coast.  There are some indications that those market maybe starting to slow down and that we could see a gradual trickledown effect if those market do in fact slow down.  One thing is for sure—real estate is both cyclical and local.  It’s not a matter of if the market will slow it’s when, and while what happens in other markets may have some effect here local factors have a much bigger impact.

Please feel free to contact me with your questions, comments, and referrals.  You may have noticed that I did not break out the numbers for distressed properties this month.  In recent months the number of distressed properties in the Boise market has dropped so low there really is no significance to them other than merely reporting how low they are. I hope distressed properties continue to be statistically irrelevant for many years to come. Have a great summer!

 Cam Johnson

Realtor®

Windermere Real Estate/Boise Valley

1412 W Idaho St.

Suite 120

Boise, ID 83702

208-258-2222 Office

208-283-3664 Cell

208-258-2230 Fax

camjohnson@windermere.com


Posted on June 13, 2018 at 3:58 pm
Cam Johnson | Posted in Monthly Real Estate Market Reports | Tagged , , , , , , , , , ,

Boise Real Estate Market Report for April 2018

Where Have All The Houses Gone? 

In speaking of the Boise real estate market it may be an exaggeration to say, “There’s nothing for sale!”, but it sure feels like it. And while there were 1280 homes for sale in Ada County as we head into the prime selling season in April that is 24.6% below a year ago, when inventory was already considered very tight. And when you consider how strong demand is especially in the lower price points it is no wonder that buyers are becoming frustrated and a sense of urgency rules the market.  Even with the sharp drop in inventory there was still a modest increase in the number of homes sold in April versus a year ago.  932 sales closed, a 1.7% increase and for the quarter sales are up 9.2% from 2017. Needless to say things are moving quickly—the average days on market stands at 34 down from 45 just last month while the months of inventory remained at 1.4 (remember 6 is “normal”). This is without a doubt the strongest Seller’s market in recent history.

And what happens to prices in such a strong Seller’s market? They go up of course.  And boy are they going up!  Continuing a trend that really only took off about 6 months ago, prices in April  were up in the double digits no matter how you slice it.  The two metrics I use, average price per square foot, and average sales price are no exception.  The average $/sf ($161) rose 15% from a year ago and 3.2% from March. If you annualized that one month increase we would be looking at a 38% year over year increase.  Meanwhile the average sales price rose to $341,000, an 18.4% annual increase. These percentage increases are both well out of the “sustainable” zone I have discussed in previous reports. In general if you factor in both inflation and wage growth in our market, then real estate prices can increase 5-8% per year without forcing large numbers of buyers out of the market and creating a bubble.  Anything over 10% for a sustained period like we are experiencing now is likely to have some effect on future market performance. Put quite simply, if prices keep going up and wage growth isn’t keeping pace then at some point so many buyers are forced out of the market that demand begins to drop and the price increases become unsustainable. Money pouring in from out of state may delay this process but as we all know real estate is cyclical and our current 7 year run in positive territory won’t last forever. Knowing exactly when things might turn is very hard to predict but many economists are predicting a slowdown in 2019 and possibly as soon as the 4th quarter of this year.  Not a collapse but a slow down and somewhat of a correction. But for now Sellers remain firmly in the driver’s seat.

SUMMARY BOISE (ADA COUNTY) MARKET STATS FOR APRIL 2018

*Does not include manufactured homes **see detailed graphs below for more information.

 

Type # Sold % +/- % of Total Sold # For Sale % +/- % of Total For Sale $/SF % +/- Average Sold Price % +/- Days on Market % +/- Months Inventory
All` 932 +1.7 100 1280 -24.6 100 $161 +15.0 $341K +18.4 34 -20.9 1.4
Non Distress 930 +3.0 99.8 1273 -23.9 99.5 $161 +14.2 $341K +18.0 34 -20.9 1.4
REO 2 -77.8 0.2 3 -66.7 0.2 $89 -16.8 $205K +9.6 14 -74.5 1.5
Short Sale 0 -100.0 0 4 -63.6 0.3 0 -100.0 0 -100.0 0 -100.0 4.0+
New Construction 218 +6.3 23.4 645 -20.2 50.4 $172 +16.2 $405K +23.1 72 -33.9 3.0

 

Canyon County 422 +8.2 100 498 -27.4 100 $126 +15.6 $235K +19.3 41 -4.7 1.2

 

Please feel free to contact me with your questions and comments.  If you would like to share this report or add someone to the list please let me know as well. 

Cam Johnson

Realtor®

Windermere Real Estate/Boise Valley

1412 W Idaho St.

Suite 120

Boise, ID 83702

208-258-2222 Office

208-283-3664 Cell

208-258-2230 Fax

camjohnson@windermere.com


Posted on May 15, 2018 at 4:23 pm
Cam Johnson | Posted in Monthly Real Estate Market Reports | Tagged , , , , , , , ,

Boise Real Estate Market Report for March 2018

Record Low Inventory, Prices Continue to Soar 

Just when you thought inventory in the Boise real estate market couldn’t get any tighter…it did!  There were 1237 homes for sale in March, 22.6% fewer than the same month last year, when I was already talking about how low our inventory was.  As recently as September inventory was 2098 homes, a difference of over 800 homes versus this March, or a 40% decrease.  While some of that is seasonal it is still a significant drop.  Since demand remains very high, at the current rate of sales we currently have only 1.4 months of inventory.  I don’t even have to check to confidently state that is a record low. Remember 6 months of inventory is a “stable” market, anything lower than 3 months is a strong seller’s market.  1.4 is almost off the charts, and if you exclude homes over $300K the numbers are even more startling.  Inventory of “affordable” homes under $300,000 was 53.9% below a year ago and there is currently only 0.7 months of inventory available.  Use $250K as the cutoff and there is only 0.5 months of inventory.  Needless to say this makes buying a home pretty difficult for many buyers especially first timers. Multiple offers and price escalations are not just common, they are the norm in the under $300K world. Even in the $600-700K range inventory is only 2.5 months, still “very strong seller’s market.  Finally, in the $700-800K range there is 3.9 months available, still firmly in seller’s market territory, but with a little more breathing room.

And despite how little there is to buy closed sales managed to increase 4.1% from March 2017 to 911 for the month. While we are beginning the ramp up to the spring/summer selling season it is still striking that sales in March were up 34.2% from the previous month even though we had a pretty strong February. New construction continues to be a strong factor, with 264 sold in March (+6.0%), representing 29% of all sales for the month.

This is all a perfect recipe for big time price increases and the market didn’t disappoint.   We are firmly in record territory just about any way you slice it. The average price per square foot hit $156 a 12.2% increase from a year ago while the average sales price surged 21.0% to $340K.  Keep in mind that this number had never topped $300K until last June and in less than a year, with the peak selling period yet to come we are already up to $340K. The Bubble question is certainly a legitimate one at this point, and while I don’t have a real answer to whether or not this is truly a bubble and if so how long will it last, I can say that the underlying conditions now are very different than they were in 2007-8.  A major macro-economic upheaval (ie: war) could definitely send the market into a tailspin, but most borrowers are much more qualified now than they were in 2007 and that may translate into a better ability to weather short term economic “storms”.  Let’s hope so!

SUMMARY BOISE (ADA COUNTY) MARKET STATS FOR MARCH 2018

*Does not include manufactured homes **see detailed graphs below for more information.

 

Type # Sold % +/- % of Total Sold # For Sale % +/- % of Total For Sale $/SF % +/- Average Sold Price % +/- Days on Market % +/- Months Inventory
All` 911 +4.1 100 1237 -22.6 100 $156 +12.2 $340K +21.0 45 -18.2 1.4
Non Distress 903 +4.6 99.1 1232 -22.0 99.6 $156 +11.4 $342K +21.3 45 -19.6 1.8
REO 4 -33.3 0.4 2 -75.0 0.2 $101 -13.7 $201K -9.0 6 -83.3 0.5
Short Sale 1 -75.0 0.1 2 -80.0 0.2 $104 +1.0 $350K +122.9 30 -63.0 2.0
New Construction 264 +6.0 29.0 684 -15.3 55.3 $159 +6.7 $366K +10.9 80 -10.9 3.2

 

Canyon County 414 +14.4 100 556 -15.1 100 $123 +16.0 $242K +25.4 51 -15.0 1.3

 

Please share your questions and comments.  And if you own a home in the Boise area and are curious about its value in the current market, even if you have no intention of selling  please feel free to contact me.  I would be happy to do a quick comparative market analysis for you. No cost and no obligation, it’s part of what I do. Have a great spring!

 

Cam Johnson

Realtor®

Windermere Real Estate/Boise Valley

1412 W Idaho St.

Suite 120

Boise, ID 83702

208-258-2222 Office

208-283-3664 Cell

208-258-2230 Fax

camjohnson@windermere.com


Posted on April 12, 2018 at 12:31 pm
Cam Johnson | Posted in Monthly Real Estate Market Reports | Tagged , , , , , , ,