Prices Hit New Record High…Again
Boise Real Estate prices hit another record high in May—not surprising given continued strong demand and low supply. The average sales price in Ada County was $386,000 up 11.9% while the median sales price was $340,000 up 13.3%. The average price per square foot also reached a new high of $179 (+9.1%). While closed sales were down 5% for the month, this is not due to lack of demand, but lack of affordable inventory. The number of homes for sale (1630) is actually up sharply versus 2018, +23.2%, but the price point of those homes for sales continues to skew higher and higher putting more and more buyers out of reach in Ada County. New construction continues to buck the overall sales trend and sales (376) were up 9.9% versus a year ago.
SUMMARY BOISE (ADA COUNTY) MARKET STATS FOR MAY 2019
*Does not include manufactured homes **see detailed graphs below for more information.
|Type||# Sold||% +/-||% of Total Sold||# For Sale||% +/-||% of Total For Sale||$/SF||% +/-||Average Sold Price||% +/-||Days on Market||% +/-||Months Inventory|
Taking a closer look at the numbers by price range illustrates that there are way fewer homes available and selling in the most affordable segments and the “sweet spot” for the market continues to move higher to around $350K. As the chart below indicates homes priced below $300,000 are becoming a rare commodity but this is still the price range that a majority of buyers, especially first time buyers, fall into. Meanwhile sales in the higher price categories are booming.
Ada County Residential Real Estate Sales By Price Range May 2019
|Price||# Sold||Sold % Change||# For Sale||For Sale % Change||Day On Market||DOM % Change||Months Inventory|
As you can see by the days on market and month’s of inventory columns, anything under $300K doesn’t last for much more than the blink of an eye. It is also interesting to note that even in the highest price category that I broke out, 800K+, there is less than 6 months of inventory, the level that has traditionally been the benchmark of a “balanced” market. Interest rates continue to be very low so this is allowing buyers some additional wiggle room as far as qualifying for a home but as quickly as prices are rising it is likely that this will be less and less of a factor. A substantial rise in interest rates would almost certainly force a significant number of buyers to the sidelines and could be the trigger of a real slow down in demand. Of course repeated predictions of interest rates of 6% or higher have fortunately not panned out as of yet but at some point we will be facing that reality due to the cyclical nature of real estate.
Please feel free to contact me with your questions and comments.
Windermere Real Estate/Boise Valley
1412 W Idaho St.
Boise, ID 83702