Boise Real Estate Market Report for October 2019

Ada County on Simmer While Canyon County Heats Up 

The Boise real estate market in October for the most part stayed true to recent trends—sales flat to slightly down while prices continue to rise.  In Ada County closed sales were off 2.1% from October 2018 although they were up 9.2% from September 2019. New construction is bucking that trend and sales were up 8.6% to 317 last month. The overall average days on market did take a jump to 41 days (+32.3%) but the months of available inventory remains critically low at 1.8. Prices meanwhile continue to go up at near a double digit pace.  The average price per square foot in October was $184, up 8.2% and a new record, while the average sold price jumped 9.9% to $390K.

A lot has been said about a looming affordability crisis in the Boise real estate market, and one symptom of that is evident in comparing Ada and Canyon County.  Buyers seeking more affordable options seem to be finding them in Nampa, Caldwell, and Middleton. While sales in relatively more expensive Ada County are flat to down, in Canyon County, where the average price of a home is over $100K lower, sales are showing a moderate gain– up 3.7%.  And prices in Canyon County are skyrocketing which may eventually narrow the gap. The average price per square foot in Canyon County was $153 in October (also a new record) and was 15.9% higher than last year.  Similarly, the average sold price jumped 18.8% to $285K.

SUMMARY BOISE (ADA COUNTY) MARKET STATS FOR OCTOBER 2019

*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 1056 -2.1 100 1865 -1.7 100 $184 +8.2 $390K +9.9 41 +32.3 1.8
New Construction 317 +8.6 30.0 981 +4.5 52.6 $190 +6.7 $433K +5.1 67 +45.7 3.1

 

Canyon County 452 +3.7 100 898 +16.9 100 $153 +15.9 $285K +18.8 34 +21.4 2.0

 

Expect the current trends to continue in the short term with the usual seasonal drop off that occurs each winter.  With interest rates still low, a generally strong economy, and a steady supply of people moving to Idaho we continue to be able to kick the affordability can down the road.  At some point it may reach somewhat of a “breaking point” and the market may need to correct itself but for now that doesn’t seem to be happening.  Please feel free to contact me with your 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

camjohnson@windermere.com

http://IdahoWindermere.com

Posted on November 8, 2019 at 12:47 pm
Cam Johnson | Category: Monthly Real Estate Market Reports | Tagged , , , , , , , , , ,

Boise Real Estate Market Report for September 2019

Homes Sales Up Slightly in September But There’s A Catch… 

The number of closed sales in the Boise real estate market was up slightly in September versus a year ago, seemingly bucking the recent trend of declining sales.  There were 967 closed sales in Ada County (+0.9% vs 2018) but looking back also reveals that September 2018 was a particularly slow month bracketed by relatively strong sales in both August and October.  Looking at the results on a quarterly basis provides a more realistic view of the market in this case and sales for the most recent 3 months are off 2.5% year to year.  Also telling is the fact that sales from August to September of this year dropped 14.5%, although much of that can be attributed to the normal seasonal drop off in sales heading into fall.  Inventory continues to be near historic lows at 1.9 months while the average days on market is up 5.9% to 36, also still near historic lows.

Several people have asked why I pay so much attention to sales trends when all they really care about are price trends.  “Is my house going up in value or going down?”  “As a buyer am I going to pay less if I buy now or wait?” are the most common questions I hear.  Well, typically prices are influenced by supply and demand and market trends in those areas generally are good predictors of future pricing trends.  Prices tend to lag somewhat in real estate, so a drop in sales (demand) and/or an increase in inventory (supply) may not be reflected in sales prices for several months.  For example,  Boise real estate has been slowing volume wise for most of this year but prices continue to rise much faster than is sustainable. The rate has dropped off somewhat from the scorching 15%+ annual increases we saw in 2016-18 but we are still flirting with double digit increases now even as volume is flat to down.  In September the average price per square foot in the Boise market was $180, up 7.8% and tied for the record high set last month.  The average sale price meanwhile was up 13.2% to $395,000 or $46,000 higher than one year ago. The obvious conclusion here is that demand is not the problem, the supply of available homes, especially “affordable” ones, continues to be the biggest barrier to market sales growth.  The average list price of homes for sale in the Boise real estate market is currently $504,000– not affordable for most buyers.

SUMMARY BOISE (ADA COUNTY) MARKET STATS FOR SEPTEMBER 2019

*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 967 +0.9 100 1858 -4.4 100 $180 +7.8 $395K +13.2 36 +5.9 1.9
New Construction 278 +9.9 28.7 915 +3.9 49.2 $186 +7.5 $423K +6.8 61 -1.6 3.3

 

Canyon County 471 +20.8 100 884 +17.4 100 $147 +7.3 $282K +11.0 30 +20.0 1.9

 

Barring any unexpected macro-economic or political changes I believe we can expect more of the same in the Boise real estate market in the near future.  Continued in-migration (not just from California!), a relatively strong economy, and very low interest rates will continue to drive the demand side while our struggles with adequate supply of affordable options for buyers will also likely continue. New construction continues to outperform the market as a whole but don’t necessarily help the affordability issue as the price points on newly built homes are typical higher than for resale.  Please feel free to contact me with any comments or questions.

Mark your calendars!

Windermere is fortunate to be able to bring our Chief Economist, Matthew Gardner, to Boise for the 3rd year in a row to give a presentation on the Idaho Economic and Real Estate Outlook for 2020.  He will be speaking at JUMP! On January 30th.  I will have a limited number of tickets for those that contact me. Corporate sponsorships are also available for reserving tables. In the past this has been a great event! Please let me know if you are interested in attending. 

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

camjohnson@windermere.com

Posted on October 9, 2019 at 2:33 pm
Cam Johnson | Category: Monthly Real Estate Market Reports | Tagged , , , , , , , , , , ,

Boise Real Estate Market Report for August 2019

Sales Slowdown Continues in August

The number of homes sold in Ada County dropped 10% in August versus a year ago to 1113 homes, continuing a trend that has been with us for almost a full year now. Year to date sales are off 2.5% and while supply continues to increase (+2.9% in August) I still believe the primary constraint on market volume is lack of affordable supply not lack of demand.  And while the average days on market was up 30.8% from a year ago it is still at only 34 days, just over half of the 60 days that is considered indicative of a stable market. At the current rate of sales there is only 1.6 months of available inventory, well into “Strong Seller’s Market” territory.

The key words in the last paragraph were “affordable supply”, because even as unit sales have dropped prices continue to increase steadily at a rate significantly higher than overall inflation.  Unfortunately prices are also still rising faster than average wage growth in our market and an “affordability crisis” is looming (or already here). The average price per square foot in August was $180, up 7.1%, while the average sales price jumped to a new record of $398K (+8.2%). For more and more buyers, especially first timers and/or Millennials, buying a home in Ada County is out of reach.  The net effect of this continues to be muted by the influx of cash rich out of state Buyers but as the markets where those Buyers tend to come from slow down, as they are doing,  we may see a further drop off in sales, that is more demand driven. As pointed out in one of my recent reports, the “sweet spot” for the market has moved up to around $350K.  That is already too high for many buyers who already live here.  With real estate prices rising 8-10% per year and wages only going up 3-4% there is bound to be fewer qualified buyers as time goes on.  Low interest rates have helped the situation but we can’t count on them to stay low forever, even though they have done so far longer than most experts predictions.

SUMMARY BOISE (ADA COUNTY) MARKET STATS FOR AUGUST 2019

*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 1113 -10.0 100 1823 +2.9 100 $180 +7.1 $398K +8.2 34 +30.8 1.6
New Construction 320 +3.9 28.8 820 +2.6 45.0 $186 +6.3 $426K +1.9 57 +21.3 2.6

 

Canyon County 541 +5.7 100 764 +20.5 100 $152 +16.0 $285K +16.8 32 +23.1 1.4

 

One interesting note that would tend to support the theory that lack of affordability may be starting to have an adverse effect on sales in Ada County, is that in Canyon County, where prices are significantly lower, sales were up 5.7% ( as opposed to -10.0% in Ada County).  And not only were unit sales up but prices were way up.  The average price per square foot  ($152) was up 16.0% while the average sales price ($285K) was up 16.8%.  Compare those to Ada County where the numbers were 7.1% and 8.2% respectively, about half the rate in Canyon County.  Of course if prices keep going up at that rate it won’t be long before Canyon County has it’s own affordability crisis.

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

camjohnson@windermere.com

Posted on September 18, 2019 at 1:55 pm
Cam Johnson | Category: Monthly Real Estate Market Reports | Tagged , , , , , , , , , ,

Boise Real Estate Market Report for June 2019

Sales Drop While Prices Hit Another New Record High 

The Boise Real Estate Market continues it’s unusual combination of flat to dropping sales volume with relentlessly rising prices. While the number of homes sold in Ada County in June (1159) was off 10% from a year ago and the average days on market is creeping up, inventory overall remains very tight and prices hit yet another new record high. June’s drop in sales is especially significant in that June is typically one of the busiest if no the busiest month of the year. This year not only were sales below last year but they dropped by 100 (7.9%) from May 2019.  The average days on market meanwhile was 32 in June, indicative of a continued very strong seller’s market but up 14.3% from a year ago.  At the current rates of sales there is 1.6 months of inventory.  This is also very low (6 being typical of a stable market) but, remarkably, is 33% higher than last June.

Prices keep going up regardless of the drop in sales.  The average price per square foot hit $181, a new record, and a 9% increase from 2018, while the average sold price also stayed in record territory jumping 9.4% to $395K.  Since January 1 the average price of a home in Ada County has risen by more than $30,000 (9.1%).   So while sales are down it is not apparently due to lack of demand but relative lack of supply particularly at the lower price points.  As I pointed out last month most of the drop in sales is coming in the under $300K sector of the market.  Sales of homes from $0-299K were off 32.3% in June while sales of homes from $500-699K were up 43.6%.  Sales in the segment in the middle, homes from $300-499K were basically flat—up +0.4%.  Another statistic of note in June was that sales of new construction also dropped 11.8%.  This is in marked contrast to recent months where I have reported that new construction seemed to be keeping the broader market afloat.  This was the first significant drop off in quite some time so it remains to be seen if it was a quirk or the beginning of a new trend that could have market wide implications.

SUMMARY BOISE (ADA COUNTY) MARKET STATS FOR JUNE 2019

*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 1159 -10.0 100 1830 +17.2 100 $181 +9.0 $395K +9.4 32 +14.3 1.6
New Construction 292 -11.8 25.2 869 +27.8 47.5 $184 +7.6 $431K +6.4 69 +13.1 3.0

 

Canyon County 517 +1.4 100 746 +23.5 100 $148 +14.7 $274K +12.3 33 +43.5 1.4

 

Barring any major unexpected macro-economic or geo-political event, expect more of the same at least through the summer.  Boise strong job market, attractive quality of life, and low interest rates should keep the fire burning for the time being.  Please feel free to contact me with your questions and comments and stay cool out there. 

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

camjohnson@windermere.com

Posted on July 16, 2019 at 2:59 pm
Cam Johnson | Category: Monthly Real Estate Market Reports, Uncategorized | Tagged , , , , , , , , ,

Boise Real Estate Market Report for March 2019

In Spite of Rising Supply Prices Hit New Record in March 

Good news and bad news for home buyers in the Boise Real Estate Market in March.  After years of record low inventory, supply has started to build, giving Buyers more choices. In spite of this and a recent trend of lower sales volume, prices continue to go up and reached new record highs in March thus reducing Buyer’s buying power.

There were 877 closed sales in March in Ada County a drop of 6.6% from a year ago. This continues a generally negative sales trend that began last July, after several years of increasing unit sales volume. Meanwhile, the number of homes for sale (1489) was up 20.4%, marking the 5th straight month of year over year increases and the 3rd month of double digit percentage increases in supply.  Inventory at 1.7 months based on the current rate of sales, is still below the 2 month threshold that the market has struggled to top in the last two years and while inventory is increasing we are still in what is considered a strong seller’s market. You may remember, 6 months of inventory is considered a stable market where buyers and sellers have roughly equal leverage in negotiations. We haven’t seen that much inventory in at least 5 years. The average days on market, reflecting higher supply and lower sales, has also been on the rise, and at 51 days is 15.9% above last March. This is approaching the 60 days that many consider indicative of a “stable” market.

Any additional leverage buyers may have gained in the last few months because of the rise in supply is not being reflected in prices so far. The average price per square foot in the Boise Real Estate Market jumped 11.5% to $174/sf, a new record high.  Similarly, the average sales price jumped to $375,000, a 10% increase over last year and also a new record high. The average sales price jumped $16,000 from February although this was probably the result of a handful of high dollar closings in March rather than a true reflection of the market. The only good news for buyers as far as pricing goes is that interest rates remain near historical lows and the consensus is that they will remain relatively stable for the remainder of this year.  Lenders also seem to be getting creative as far as offering new products that will help buyers getting squeezed by higher prices  find an acceptable alternative to a “vanilla” conventional loan. Fortunately we are not seeing a widespread return to the types of irresponsible lending that occurred during the 2004-2007 boom.

SUMMARY BOISE (ADA COUNTY) MARKET STATS FOR MARCH 2019

*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 877 -6.6 100 1489 +20.4 100 $174 +11.5 $375K +10.0 51 +15.9 1.7
New Construction 325 +19.9 37.1 819 +19.7 55.0 $176 +10.7 $405K +10.4 87 +10.1 2.5

 

Canyon County 381 -11.6 100 615 +10.6 100 $137 +12.3 $253K +5.0 45 -11.8 1.6

 

New construction continues to drive the market even as supply of existing homes starts to tick up. While overall sales of homes were down 6.6%, sales of new homes surged 19.9% and represented 37.1% of all sales in March.  Supply is also rising with 819 new homes listed (+19.7%) representing 55% of all available homes for sale. Despite all the apartment building going on there seem to be plenty of buyers for new single family homes. As summer approaches expect new construction to continue to flourish.

Overall, buyers have more properties to choose from but continue to feel the pressure on affordability and buying power as strong demand causes prices to keep rising. Expect more of the same as 2019 rolls on although I do expect a gradual flattening in the price curve if the current trend towards higher supply and lower sales continues. With the spring and summer selling season kicking into gear things will continue to be challenging for buyers particularly in the under $300k segment of the market.  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 April 13, 2019 at 10:15 am
Cam Johnson | Category: Monthly Real Estate Market Reports | Tagged , , , , , , , , ,

Boise Real Estate Market Report for February 2019

More Options For Homebuyers This Spring, Market Continues to Calm

Based on your feedback and a desire to make this report even easier to digest in a short amount of time I am trying a new format this month. Rather than “conversational” text this month’s highlights will be presented in bullet point form. Please feel free to let me know what you think. A spreadsheet and graphs are included as always, but the bullet points are intended to summarize and highlight that information.

• Number of homes for sale 1455 (+18.2% vs Feb 2018)
• 4th straight month of positive year over year inventory, 2nd month in a row of double digit increases
• Closed sales (707) up 1.7% in February
• First monthly increase since October. Sales trend has been generally negative since last July
• Inventory at 2.1 months, 4th straight month over 2.0 after being at or below 2 for well over a year
• Average Days on Market at 52, highest since February 2018
• Average Days on Market are twice what they were in August (26)
• Average price per square foot in Ada County $171, up 11% vs 2018
• Lowest percentage increase in one year
• Average Sales Price $360K, up 6.8%
• Lowest percentage increase in almost 2 years
• New construction inventory up 23.4% (901), Sales up 14.3%
• 37.2% of homes sold in February were new construction
• 61.9% of homes for sale in February were new construction
• In Canyon County sales and inventory trends similar to Ada County but prices continue to surge
• Average $/sf +20.5%, Average sale price +19.2%

SUMMARY BOISE (ADA COUNTY) MARKET STATS FOR FEBRUARY 2019

*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 707 +1.7 100 1455 +18.2 100 $171 +11.0 $360K +6.8 52 -13.3 2.1
New Construction 263 +14.3 37.2 901 +23.4 61.9 $174 +7.4 $403K +4.7 78 -11.4 3.4

 

Canyon County 298 -4.2 100 643 +18.0 100 $141 +20.5 $255K +19.2 44 -21.4 2.2

 

 

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 March 21, 2019 at 11:48 am
Cam Johnson | Category: Monthly Real Estate Market Reports | Tagged , , , , , , , , ,

Boise Real Estate Market Report for January 2019

Double Digit Price Increases Despite Falling Sales and Rising Inventory  

In what is threatening to become a trend, in January the Boise real estate market witnessed the counterintuitive combination of sharply dropping sales, rising inventory and strong price increases.  Closed sales for the month (604) were off 8.8% versus 2018 and the number of homes for sale shot up 17.5% to 1494. At the current rate of sales this represents 2.5 months of inventory, still very low, but the highest in two years.  The average days on market at 51 was up 8.5%, also indicating the market is slowing somewhat. Given modestly rising interest rates, uncertainty over the effects of the tax “reform” passed in 2017 and relative lack of affordability caused by higher prices the slowdown is not a surprise.

Neither is the fact that prices are often slow to react to market shifts, but in this case the percentage increase in prices has remained in double digits despite several months of declining market volume.  In fact the average price per square foot in the Boise real estate market hit a new record high in January of $173, 13.1% above a year ago. Meanwhile the average sales price was up 11.7% to $363,000, the second highest ever. Most experts feel that gradually prices will fall more into step with market activity but it could take several more months.

In the meantime people are wondering if we are experiencing a price bubble.  Certainly double digit price increases in the face of dropping market volume and rising inventory are unsustainable but that doesn’t necessarily mean the bottom will drop out as it did in the last recession.  The foundation of the market is much more solid than it was then with stricter lending practices, a generally healthy economy and job market and continued in-migration to the Boise area. For another look at the outlook for Idaho, please review the latest report prepared by Windermere’s chief economist Matthew Gardner. As we all know real estate is local and while the general outlook for Boise is relatively strong despite the recent slowdown in sales, the national picture may be less rosy.  A recent article in Business Insider paints a much bleaker picture of doom and gloom for the housing and mortgage industries.  It is worth a read even if it doesn’t directly apply to our market.

 

SUMMARY BOISE (ADA COUNTY) MARKET STATS FOR JANUARY 2019

*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 604 -8.8 100 1494 +17.5 100 $173 +13.1 $363K +11.7 51 +8.5 2.5
New Construction 211 +20.6 34.9 955 +18.3 63.9 $178 +11.3 $414K +8.4 69 +9.5 4.5

 

Canyon County 273 -1.8 100 622 -0.3 100 $137 +20.2 $256K +15.3 50 +4.2 2.3

 

As mentioned last month, new construction continues to buck the trend and is in some ways the “saving grace” for the market right now. Despite the slowdown in the overall market sales of newly built homes (not including custom build jobs) surged 20.6% in January and represented almost 35% of all homes sold. The number of new homes for sale was also up sharply (+18.3%) and made up 63.9% of the total available inventory. Prices for new homes were increasing at a similar pace to existing homes.  The average price per square foot ($178) was up 11.3% while the average sales price was $414,000 up 8.4%.

While the current stats offer a glimmer of hope for buyer we remain in a strong seller’s market.  Even though the multiple offers and bidding wars are not as common as they were last summer buyers are still generally dealing with lower than average inventory and decreasing affordability in the face of ever increasing prices.  Please feel free to contact me with your 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 February 14, 2019 at 3:46 pm
Cam Johnson | Category: 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 | Category: 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 | Category: 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 | Category: Monthly Real Estate Market Reports | Tagged , , , , , , ,