Quarterly Real Estate Update
Boise ID Metro AreaOct 2018- Q3 Report
Happy Late Fall! Boise area real estate markets had a very strong third quarter, and with housing supply still so low, next year should be strong as well.
In the meantime, winter is on the doorstep... and this is what I call bargain season. Now until February you'll face the least competition from other buyers and investors and this means more bargaining power to get price reductions & closing costs paid by sellers. Interest rates are still historically low and I would not bet against another year of strong home price appreciation.
Boise Metro Home Prices- Q3 of 2018
Quarterly Median Existing Home Prices are the most reliable indicator of housing market price 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 jumped a very strong 6.23% from the previous quarter to $303,950. This is the best third quarter performance in several years and a good sign that next year will be strong too. Year over year, the Ada County median existing home price is up 18.3%. Those are big gains, but still no bubble as our prices were catching up.
Canyon County's median existing home price during Q3 rose an impressive 5.1% from the previous quarter to $211,250. Year over year, the median in Canyon County is up 20.7% when compared to Q3 of 2017. That's $40k in wealth created in one year on the median priced home!
Discounts Still Shrinking
This chart shows all existing home sales through the third quarter in Ada county. The discount is the difference between the average list and average sale price. This does not include any buyer's closing costs paid by the seller.
Home prices are up, but the discount off asking that sellers accept continues to get smaller. A very clear sign that the housing shortage is intensifying as population grows.
Boise Idaho Housing Supply Shortage
This is why home prices are rising so fast in SW Idaho. Growing demand and not enough sellers has held supply levels below a month (can't go much lower) for most of this year.
This charts covers all single-family homes, including new construction, actively for sale or under contract on the first day of each month in Ada County. Given these conditions, Boise area home prices will probably start climbing double-digits again next spring.
This is not a local trend, but a widespread boom in demand and shortage in housing. Many cities across the country have experienced similar increases in home prices as the economy improves and the pent-up demand for housing over the last decade is absorbed, as this from NAR's Q2 Medians illustrates.
Boise area home prices are still below the national median and way below the West, so there's room for further increases. The higher-priced metros are rising almost as fast. No sign of a local bubble that could burst.
Vacancy Rates Show Tight Rental Market
Just like home prices, rents are also rising due to low supply in the Treasure Valley. According to SW Idaho National Assoc. of Residential Property Managers Q2 Report, the overall vacancy rate on 7000+ managed properties was only 2.03%.
On single-family homes, the vacancy rate was just 1.36% in Ada county and 0.74% in Canyon county. That is extreme. Landlords- Have you raised your rents lately or are you leaving money on the table? Craigslist is a handy way to research market rents. Spring is a good time to increase rents.
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.