Follow up to the February 2018 Market Report

Hello BRR Members,

You may have read the Idaho Statesman article about the median sales price for homes in Ada County, based on the February market stats. We wanted to provide you with some additional data before heading out to show homes this weekend, in case your clients have questions.

We tend to see a “bump” in home prices in the first or second quarter each year.

Between January 2018 to February 2018, the overall median sales price for Ada County grew by 6.3%, from $279,900 to $297,500. While a large month-over-month increase seems suspect, we tend to see a bump in home prices in the first or second quarter of each year correlating with the spring housing market. For example:

However, these annual “bumps” have resulted in a major increase in home prices over the past five years, which leads to the questions we’re hearing (and asking ourselves) about affordability. More on that in a moment.

The overall median sales price helps us evaluate market trends, but (as you well know) individual home prices will vary by property type, neighborhood, amenities, and more.

The $297,500 price quoted is correct for the overall median sales price and is what we reported in the February Market Report; however, when we look at new versus existing homes, we see a different story.

In February 2018, the median sales price of a new home was 34.3% higher than that of an existing home in Ada County. So, when the number of new home sales jumped by 43.0% year-over-year, it pulled up the overall median sales price:

 
The underlying growth in prices for new construction is directly tied to the rising costs of land, labor, and materials while existing home prices are rising due to limited and decreasing supply.

For those buyers shopping existing homes, the median sales price in Ada County was at $269,900 in February, nearly $30,000 less than the overall median sales price.

We hope this information is helpful for you. If you have questions or need more, please don’t hesitate to let us know.

BRR is committed to fostering conversation around housing affordability and growth, and what’s needed for our communities.  We’ve been encouraged by the discussions we’ve been a part of with related industry groups of developers, builders, and mortgage lenders; local governments, transportation agencies, and economic development groups; and, engaged neighborhood associations and residents who want to preserve our quality of life.

If you’d like to be part of the growth and affordability discussion or have ideas on what you’d like to see BRR doing on behalf of you and your clients, please reach out to me directly.

Sincerely,

Breanna Vanstrom MBA, RCE
Chief Executive Officer
Boise Regional REALTORS®