Quarterly Real Estate Update
Boise ID Metro AreaOctober 2017 Edition-
Happy Fall. Go Broncos! Here comes winter and the slow season for real estate. I generally counsel sellers to avoid marketing this time of year, but with supply so low it will still be a seller's market.
Bargain season is here for buyers with less competition and softer prices during cold weather and holiday distractions. Contact me to get ready with a lender pre-approval and automatic e-mails with MLS listings that match your criteria. Interest rates and prices can only go up next year- don't miss your chance!
Boise Metro Home Prices- Q3 Numbers- Strong!
Quarterly Median Existing Home Prices are the most reliable indicator of housing market trends. I use only existing homes in my chart, as the ebb & flow of new construction can skew the numbers.
Ada County's median existing home price for Q3 rose 4% from the previous quarter to $256,950. That's the largest third quarter increase in five years. Year over year, the Ada County median existing home price is up a very strong 11.2% when compared to Q3 of 2016.
Canyon County's median existing home price during Q3 rose 1.74% from the previous quarter, gaining only $3,000 in value to $175,000. Year over year, the median in Canyon County is up 9.44% when compared to Q3 of 2016. That's down a little.
Ada County Home Price Bubble?
Double-digit annual increases cause concern about a bubble that could burst. I use this chart to monitor the situation. The main driver of home price increases is demand and Idaho is still one of the fastest growing states in the nation and a large number of people are coming to the Treasure Valley. As a result, there are not enough homes on the market to keep up with demand, driving prices higher.
Beginning in 1997, this chart compares the current Ada County median existing home price against a baseline of 3.5% for the long-term average appreciation documented since the 1940's.
It is important to note that the previous downturn was not caused by a localized bubble in prices or decreasing population growth. Rather by a wide-spread economic downturn. Today, I also find comfort in the fact that we are still much closer to the baseline than in 2007 and the slope is not as steep going upward this time.
Still Shrinking Discounts on Homes
I am always watching for any sign of a real estate downturn. Locally, the market is only getting tighter and looking strong for 2018.
At the height of the downturn in 2007, when prices were falling, the average discount that home sellers accepted rose to a high of 4.5% off asking. Since then, the trend has been steadily downward. The average discount off asking price is under 1% and much lower than during the previous boom.
Going into fall, the next few months will be the ideal time for home buyers to make a move. These underlying conditions (strong demand/low inventory/low rates) will not go away before the next spring rush. All signs point to another strong year in 2018.
I have more charts! See My Market Monitor for more information on Boise Metro housing markets and trends, updated monthly.
I am always happy to answer real estate questions; recommend a good lender, provide a free CMA or neighborhood history, an investment analysis, should-I-refi-or-remodel questions, first-timer education, etc.