November 2018 Market Report

MORE NEW CONSTRUCTION SALES AND FEWER EXISTING HOMES KEPT
ADA COUNTY PRICES UP IN NOVEMBER

Key Takeaways:

  •  The overall median sales price for Ada County reached $324,250 in November 2018, driven by the persistently low inventory of existing homes, and more new homes selling at overall higher prices, primarily due to rising construction costs.
  • There were just 661 existing homes available for sale at the end of November 2018, down 24.0% from October — a drop of 209 properties. More existing inventory is needed at all prices points to meet the demand from home buyers, which is what will contribute to our market eventually coming back in to balance.


Analysis:

The median sales price for Ada County in November 2018 was $324,250 for existing and new homes combined. This was up 20.1% over the same month last year, but nearly even with October 2018.

As we’ve shared many times through our market reports, local home prices are being driven by the persistent and historically low inventory of existing homes compared to demand, and more new homes selling at overall higher prices, primarily due to rising construction costs.

On average, the share of monthly homes sales that are new is typically between 22-23%, meaning the other 77-78% of the sales are of existing homes. When the share of new home sales goes over 24% or 25%, we will see overall home prices (looking at existing and new homes together) increase, on average, between 12-14% year-over-year. As the share of new home sales increases, so does the overall median sales price and the related year-over-year increase.

This is what’s meant when we say the “overall home price is being driven up by more new homes selling.” To further illustrate this, the following table shows the share of new home sales over the past nine months compared to the overall median sales price and year-over-year increase:

November 18 Ada County Share of New Home Sales

However, new home prices are just part of the story.

In November 2018, the median sales price of existing homes in Ada County reached was $295,000, up 18.0% over November 2017. In this segment of the market, price increases are being driven by very low inventory compared to buyer demand.

There were just 661 existing homes available for sale at the end of November 2018, down 24.0% from October — a drop of 209 properties — and down 12.1% from last year. More existing inventory is needed at all prices points to meet the demand from home buyers, which is what will contribute to our market eventually coming back in to balance.

In comparison, the median sales price for new construction was at $390,000 in November 2018, up 13.9% over November 2017, and just below the most recent record high for this segment, which was $393,705 in June 2018.

If our market conditions of low inventory and high demand continue, there is no guarantee we’ll see prices drop significantly over the next few months, as we might normally expect as we move into the winter months.

However, those thinking about selling or buying shouldn’t be concerned with ‘timing the market,’ because the best time to buy or sell is when it fits your needs and circumstances. If you’re thinking about making a move, talk to your REALTOR® to explore your options.

 

HOME SALES AND PRICES UP IN GEM COUNTY IN NOVEMBER

In November 2018, 27 homes sold in Gem County, up 17.4% over last year. This left 53 homes available for sale at the end of the month — a decrease of 15.9% year-over-year. Despite persistently low inventory, Gem County has seen strong sales numbers for the last five months.

Looking at sales over the past 12 months, the median price for homes that sold through November 2018 was $196,303 — up 8.1% over the same period last year.

Due to the smaller number of sales in the county, the 12-month average is a helpful way of analyzing area price trends, as it adjusts for any months in which a very high- or low-priced home sold that would otherwise be inconsistent with the general market.

Apparently, the colder temps haven’t deterred buyers in Gem County. Thinking about selling? Talk your REALTOR® to find out what your home may be worth and what options are available based on your specific situation.


RESOURCES:

Additional information about trends within the Boise Region, by price point, by existing and new construction, and by neighborhood, are now available here: Ada CountyCanyon CountyGem County, and City Data Market Reports. Each includes an explanation of the metrics and notes on data sources and methodology.

ADA Snapshot - Nov 18Canyon Snapshot - Nov 18Gem Snapshot - Nov 18

Download the latest (print quality) market snapshot graphics for Ada CountyAda County Existing/ResaleAda County New ConstructionCanyon CountyCanyon County Existing/ResaleCanyon County New Construction, and Gem County.

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This report is provided by Boise Regional REALTORS® (BRR), a 501(c)(6) trade association, representing real estate professionals throughout the Boise region. Established in 1920, BRR is the largest local REALTOR® association in the state of Idaho, helping members achieve real estate success through ethics, professionalism, and connections. BRR has two wholly-owned subsidiaries, Intermountain MLS (IMLS) and the REALTORS® Community Foundation.

If you have questions about this report, please contact Cassie Zimmerman, Director of Communications for Boise Regional REALTORS®. If you are a consumer, please contact a REALTOR® to get the most current and accurate information specific to your situation.

The data reported is based primarily on the public statistics provided by the IMLS, available at: intermountainmls.com. These statistics are based upon information secured by the agent from the owner or their representative. The accuracy of this information, while deemed reliable, has not been verified and is not guaranteed. These statistics are not intended to represent the total number of properties sold in the counties or cities during the specified time period. The IMLS and BRR provide these statistics for purposes of general market analysis but make no representations as to past or future performance. The term “single-family homes” includes detached single-family homes with or without acreage, as classified in the IMLS. These numbers do not include activity for mobile homes, condominiums, townhomes, land, commercial, or multi-family properties (like apartment buildings).

2018 Mid-Year Housing Summit Recap

Thanks to everyone who attended the 2018 Mid-Year Housing Summit from Boise Regional REALTORS®. If you missed the event, don’t worry! A summary of the discussions and links to the various presentations are available here.

Links and resources referenced at the Mid-Year Housing Summit:

FH ClassInvest in RPACAmm

**Please note: The RPAC investment information on this page is only intended for BRR members.

2017 Boise School District Bond Update

2017 Boise School District Bond Update

Coby Dennis, the Deputy Superintendent of the Boise School District, provided a progress report on the various projects funded by the 2017 school district bond. Boise Regional REALTORS® endorsed and supported this successful campaign last year.


Fair Housing Update

Fair Housing Update

Debbi Myers, certified real estate instructor and BRR Director, discussed the importance of understanding fair housing in our industry and gave a teaser on the upcoming fair housing class that was refreshed in honor of the 50th anniversary of the Fair Housing Act.

Ready to learn more about fair housing? Join us for a Lunch & Learn: That’s Not Fair! How to Avoid Fair Housing Violations, on Tuesday, October 23, from 12:00 p.m. – 2:00 p.m. Register today!


2018 Mid-Year Residential Real Estate Update

2018 Mid-Year Residential Real Estate Update

Breanna Vanstrom, Chief Executive Officer for Boise Regional REALTORS®, dug into the data and identified the trends regarding price, supply, demand, inventory, and strategies for building your business during the 2018 Min-Year Residential Real Estate Update. You can watch her full presentation on Facebook Live below. Thank you to our Facebook Live Sponsor, Idaho Housing and Finance Association.

“Getting to Solutions” Listening Session on Growth

Getting to Solutions

Soren Dorius, Director of Government Affairs for BRR, started the listening session by sharing some key findings from the Second Annual Treasure Valley Survey a survey conducted by BSU to explore public opinion on growth, transportation, and other issues. This project was funded in part by a $15,000 Smart Growth Grant secured by BRR.

The group shared ideas and solutions about how to maintain the quality of life during this time of growth, thoughts on what area would be the next good candidate for higher density projects, what features and places need to be “off limits” to development, the role of transportation, how REALTORS® can participate in public meetings, and much more.

PHOTO GALLERY

Thanks to our event sponsor and annual sponsors for making this event possible!

FB Live sponsor

2018 Annual Sponsor Poster v3 - compressed

 

Home Prices Near Peak but Inventory Mix Makes This Market Different

In April 2016, home sales and prices were up, while inventory and market times were down. These have been the trends for the past few months, and as such, we’ve talked about how our low supply of existing homes and increasing demand from in-migration and growing local population have impacted prices in past market reports.

But month-after-month, the median sales price has been getting closer to our market peak in July 2006 — off just 3.1% for Ada County as of April 2016. While this has caused many to wonder if we’re nearing another market peak, taking a closer look at today’s inventory, that doesn’t seem to be the case.

Single-family inventory in Ada County, for existing and new construction combined, in April 2016, was 63.9% lower than the high in July 2007. So, while prices are getting back to the recent market peak, inventory is nowhere near the levels we saw back then. And that’s kind of a good thing…

We don’t have an oversupply of homes being built speculatively, nor do we have the fear of a distressed “shadow market” as we did back in the mid-2000s. On the contrary, new construction inventory in Ada County was at 3.9 months of supply in April (on the edge of the 4-6 month mark that’s considered balanced). Homes that were foreclosures or short sales accounted for less than 1% of the inventory — and a recent report from RealtyTrac indicated that the number of homes nationwide that are “underwater” continues to go down.

Of course the difficulty with having low inventory overall, especially among existing homes, is that buyers don’t have many options. On top of that, pending sales continue to outpace the previous year, up 20.2% in Ada County compared to April 2015. Therefore, it’s high demand vs. low supply that is pushing up prices, not market speculation. And for those buyers who do purchase, improved lending practices and low unemployment rates mean the mortgage default risk going forward should remain low.

Another positive sign regarding equity is that Idaho is one of the top states for all-cash purchases. While this includes some owner-occupants, most of this activity is among investors who have equity in these properties, instead of carrying multiple, potentially risky, mortgages.

Improving prices should also help homeowners who purchased just before, or during, the market peak regain any lost equity, which will in turn, enable to them to sell. “Many people have held off listing their homes because they simply couldn’t afford to; and it’s been a main contributor to our current inventory situation,” said Carey Farmer, 2016 President of Boise Regional REALTORS® and Broker Associate with Group One Sotheby’s International Realty. “I encourage anyone who is considering selling their home to talk to a REALTOR® to get a true picture of what their home is worth in today’s market. Many people are in a better position than they realize, and we need more homes to come online to meet the demand from buyers.”

Additional information about trends within each county, and by price point, by existing vs. new construction, and by neighborhood, are now available in the April 2016 Market Report.  This report includes an explanation of the metrics and notes on data sources and methodology.

Ada County Market Snapshot: April 2016Canyon County Market Snapshot: April 2016

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This report is provided by the Ada County Association of REALTORS®, which began doing business as Boise Regional REALTORS® (BRR) in 2016. BRR is the largest local REALTOR® association in Idaho, with over 3,600 members and two wholly-owned subsidiaries — the Intermountain Multiple Listing Service, Inc. (IMLS) and the REALTORS® Community Foundation. This report is based primarily on the public statistics provided by the IMLS, available at: intermountainmls.com/Statistics/Static.aspx. These statistics are based upon information secured by the agent from the owner or their representative. The accuracy of this information, while deemed reliable, has not been verified and is not guaranteed. These statistics are not intended to represent the total number of properties sold in the counties or cities during the specified time period. The IMLS and BRR provide these statistics for purposes of general market analysis but make no representations as to past or future performance.  || The term “single-family homes” includes detached single-family homes with or without acreage, as classified in the IMLS. These numbers do not include activity for mobile homes, condominiums, townhomes, land, commercial, or multi-family properties (like apartment buildings). If you are a consumer, please contact a REALTOR® to get the most current and accurate information specific to your situation.

 

Distributed to the media on May 12, 2016.