There’s no question, Boise is growing and the real estate market is booming right along with it. In May, total sales volume for residential real estate in Ada County hit a record high of $404.4 million, a 30.5% increase from the same time last year. This large jump is due primarily to two factors: (1) more people are moving into the area and buying homes and (2) home prices are escalating, due to low inventory and increased costs of land, labor, and construction.
Because of lack of availability of existing homes to meet new buyer demand, builders have been busy. In May, there was a 60% year over year increase in the number of newly constructed homes sold! Over the same time frame, prices of new construction also increased by 8.7%. This is a decent appreciation for builders but is actually only half as much as the price increases experienced in the “existing homes” market. This month, the median year over year price appreciation for existing homes rang in at 16%.
This rapidly growing market does not cause me too much concern for those who already own a home in the valley and are building equity at a rate in line with cost increases. Their equity position will likely give them the ability to sell and buy without too much financial strain. However, I do have concern for those local people who are renting and hoping to buy. With Idaho wages not increasing as rapidly as housing prices and with no growing equity in a current home, these individuals may be quickly pushed out of the market as housing becomes less affordable. Although not the scenario most people like to see, this is the picture that is expected to occur as any city grows—and Boise is certainly growing! If you’d like to talk with us more about the market and how it may affect your personal buying/selling situation, please don’t hesitate to call! We’d love to share what we know and help you discern the best potential next steps!
Below are the current Ada County market statistics for May 2017 compared to May 2018:
- Closed sales – 1,160 (up 13.5%)
- Median Sales Price - $287,000 (up 16%)
- Days on the Market - 19 (down 9.5%)
- Inventory: 741 ?(down 33.6%)
- Months of Supply: 1 (down 33.3%)
We also wanted to show how the number of months supply of inventory fluctuates based on the price range.??The current month’s existing supply condition in each price range is as follows:
- $159,999 or less: 1.3 month
- $160,000 - 199,999: 0.4 month
- $200,000 - $249,499: 0.3 month
- $250,000 - $299,999: 0.6 month
- $300,000 - 399,999: 1.1 months
- $400,000 - 499,999: 1.6 months
- $500,000 - $699,999: 1.8 months
- $700,000 - $999,999: 4.2 months
- Closed sales – 325 (up 60.1%)
- Median Sales Price - $349,900 (up 8.7%)
- Days on the Market - 68 (down 13.9%)
- Inventory: 650 ?(down 19.3%)