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The Boise Regional REALTORS® monthly market report is released on the 12th of each month. If the 12th falls on a weekend or holiday, the report will be released the next business day.
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October 2018 marks a full four years of falling inventory, specifically in the number of existing homes for sale in Ada County, when looking at activity by month year-over-year.
There were 870 existing homes for sale in Ada County in October 2018, down 15.0% from October 2017 and down 48.8% from October 2014 when the decline began.
In Ada County, existing home sales in September 2018 were down 24.0% compared to the same month last year – and down 25.2% from August 2018. This number marks the first double-digit decline in existing home sales since February 2017 which could easily support that "market turn" discussion.
The median sales price for Ada County reached a new record in August 2018, of $334,400 for existing and new homes combined. This was up 20.3% over the same month last year, and up 4.8% from July.
ADA COUNTY EXISTING/RESALE
HOUSING INVENTORY INCHES UP IN JULY
July 2018 marked four consecutive months of gains in existing/resale inventory in Ada County when measured month-to-month. More inventory is the key to bring balance back to the residential real estate market, and while this recent uptick was not enough to stop the nearly four-year trend of year-over-year decreases, we’ll certainly take it.
GEM COUNTY HOME SALES WERE STRONG
AS INVENTORY INCREASES IN JULY
In July 2018, 31 homes sold in Gem County, up 14.8% from July 2017. This left 76 new and existing/resale homes available for sale at the end of the month — down 8.4% from the same month last year, but up 4.1% from the previous month (June 2018).
The total sales dollar volume of all residential real estate sold in Ada County last month was at the highest level ever in a month (based on data going back to 2005), reaching $404.4 million, an increase of 30.5% over May 2017. The previous high point was in June 2017 at $371.1 million.
May’s jump in volume was driven by a 60.1% increase in the number of new homes that sold compared to May 2017, along with an 8.7% year-over-year bump in the median sales price.
April brought with it a significant increase in the number of existing homes for sale compared to March 2018, helping to ease the median sales price for existing homes by $15,000, landing at $275,000 in April 2018. This is good news for buyers currently in shopping for a home, but potential sellers should not be concerned. Monthly fluctuations like this are typical during the spring and summer, and the April 2018 median price for existing homes was still 15.3% higher than the same month last year.
Q1-2018 Ada County Market Report
Warmer Winter Temps Meant an Early Spring Housing Market
Warmer winter temps may have encouraged homebuyers to shop earlier, as the growth in purchase activity during the first quarter was more like what we typically see early in the second quarter of the year.
The median sales price is the point at which half of the homes sold for more and half sold for less. For the existing/resale segment, there were approximately 725 homes that sold for less than $273,650 during the first quarter of 2018 in Ada County, and another 725 that sold for more.
Prices for existing/resale homes continue to be driven by lack of inventory versus demand, with 33.1% fewer options for buyers to choose from in the first quarter compared to same quarter last year.
Just because there is low inventory doesn’t mean there is no inventory. At the end Q1-2018, there were nearly 1,150 existing and new homes for sale in Ada County across all price points.
ADA COUNTY HOME PRICES HIT RECORD HIGH AS INVENTORY DROPS TO RECORD LOW
Boise being named one of the fastest growing cities has certainly brought a lot of additional attention to our region lately, but our market reports have been reflecting that growth for months, most evident through buyer demand vs. supply and its impact on home prices.
In February 2018, inventory was down 18.8% from the previous year, with a record low of 1,205 homes available for purchase, compared to 1,513 homes that were under contract, up 16.1% year-over-year. The result was a new high median sales price for Ada County of $297,500, up 16.7% over the same month last year.
NO LAG IN DEMAND FOR HOMES IN ADA COUNTY
Last January, we discussed the effects of a historic snowfall on Ada County’s real estate market, which is quite different from recent stories about the mild winter helping boost new construction.
But despite builders being able to work when they normally cannot, it hasn’t been enough to push new inventory higher than it was last year. Homeowners are also not listing quickly enough to raise existing inventory levels, reasons for which are discussed in BRR’s 2017 year-end market report.
Surprisingly, pending sales (a measure of home buyer demand) were up 32.7% year-over-year, even as the supply of homes was down.
MORE NEW CONSTRUCTION HOMES AVAILABLE THAN EXISTING IN ADA COUNTY
Ada County hit another record low for inventory in December 2017, with just 1,391 homes for sale — a 6.6% drop from December 2016. While we’ve discussed the lack of inventory at length in our previous market reports, a new twist on the inventory shortage showed up in the December 2017 numbers…
There were 317 more new homes for sale in Ada County in December 2017 than existing homes. The actual numbers reported for Ada County were 854 new homes, compared to 537 existing homes on the market in December 2017.
$3 BILLION WORTH OF HOMES HAVE SOLD IN ADA COUNTY, SETTING NEW RECORD
Ada County home sales surpassed the $3 billion-mark for the first time, based on Total Dollar Volume figures year-to-date, January 1–November 30, 2017.
Historically, the month of December adds another $100-150 million worth of sales, on average going back to 2005, so we should see Total Dollar Volume exceed $3.1 billion for all of 2017.
Year-to-date through November 2017, nearly 10,000 homes sold in Ada County, up just 2.6% compared to 2016. Breaking this down by property type illustrates the impact limited supply has had on existing home prices, as well as higher building costs on new home prices.
MANY REASONS FOR LACK OF ENTRY-LEVEL HOUSING INVENTORY IN ADA COUNTY
October 2017 marks a full three years of falling inventory, specifically in the number of existing homes for sale in Ada County.
There were 1,023 existing homes for sale in Ada County in October 2017, down 8.3% from October 2016, and down nearly 40% from October 2014 when the decline began.
There are many reasons the Boise Region is facing a lack of homes for sale—particularly for those priced below $250,000.
FAST-MOVING HOUSING MARKET CONTINUES TO BE DRIVEN BY DEMAND
Despite rising home prices, today’s housing market doesn’t have much else in common with the market we saw prior to the recession.
The Boise Region’s housing market is being driven by real home buyer demand, not speculation, which was common a decade ago. And as we’ve mentioned before, the increase in demand and lack of inventory has pushed up home prices.
ADA COUNTY HOME PRICES REACH NEW RECORD IN AUGUST WHILE THE PACE OF GROWTH STEADIES
Three main factors continue to drive housing demand in Ada County — increased economic development, limited housing supply, and a growing population — resulting in a record high median sales price in August 2017 of $278,000, up 9.6% from a year ago.
Yet while the actual median sales price continues trending upwards, the rate at which it does so has been slowing down. Think of it like driving your car up a hill: as the road gets steeper, the speed at which you drive decreases. You’re still gaining ground, just not as quickly.